10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

___________________________________

FORM 10-Q 

___________________________________

☒    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended February 28, 2021

OR

☐    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from             to            

Commission file number 1-4304

___________________________________

COMMERCIAL METALS COMPANY

(Exact Name of Registrant as Specified in Its Charter)

___________________________________ 

Delaware	75-0725338
(State or Other Jurisdiction of Incorporation or Organization)	(I.R.S. Employer Identification Number)

6565 N. MacArthur Blvd.

Irving, Texas 75039

(Address of Principal Executive Offices) (Zip Code)

(214) 689-4300

(Registrant's Telephone Number, Including Area Code)

Securities registered pursuant to Section 12(b) of the Act:

Title of Each Class	Trading Symbol(s)	Name of Each Exchange on Which Registered
Common Stock, $0.01 par value	CMC	New York Stock Exchange

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 ("Exchange Act") during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  x    No ¨

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).    Yes  x    No  ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☒	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☐
		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes  ☐    No  ☒

As of March 23, 2021, 120,510,370 shares of the registrant's common stock, par value $0.01 per share, were outstanding.

COMMERCIAL METALS COMPANY AND SUBSIDIARIES

TABLE OF CONTENTS

PART I — FINANCIAL INFORMATION	3
Item 1. Financial Statements (Unaudited)	3
Condensed Consolidated Statements of Earnings - Three and six months ended February 28, 2021 and February 29, 2020	3
Condensed Consolidated Statements of Comprehensive Income - Three and six months ended February 28, 2021 and February 29, 2020	4
Condensed Consolidated Balance Sheets - February 28, 2021 and August 31, 2020	5
Condensed Consolidated Statements of Cash Flows - Six months ended February 28, 2021 and February 29, 2020	6
Condensed Consolidated Statements of Stockholders' Equity - Three and six months ended February 28, 2021 and February 29, 2020	7
Notes to Condensed Consolidated Financial Statements	9
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations	22
Item 3. Quantitative and Qualitative Disclosures About Market Risk	29
Item 4. Controls and Procedures	29
PART II — OTHER INFORMATION	30
Item 1. Legal Proceedings	30
Item 1A. Risk Factors	30
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds	30
Item 3. Defaults Upon Senior Securities	30
Item 4. Mine Safety Disclosures	30
Item 5. Other Information	30
Item 6. Exhibits	31
Signature	32

2

PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

COMMERCIAL METALS COMPANY AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS (UNAUDITED)
	Three Months Ended				Six Months Ended
(in thousands, except share data)	February 28, 2021		February 29, 2020		February 28, 2021		February 29, 2020
Net sales	$	1,462,270	$	1,340,963	$	2,854,073	$	2,725,671
Costs and expenses:
Cost of goods sold	1,228,343		1,123,096		2,403,162		2,269,610
Selling, general and administrative expenses	115,417		115,538		229,044		226,537
Loss on debt extinguishment	16,841		—		16,841		—
Interest expense	14,021		15,888		28,280		32,466
Asset impairments	474		—		4,068		530
	1,375,096		1,254,522		2,681,395		2,529,143
Earnings from continuing operations before income taxes	87,174		86,441		172,678		196,528
Income taxes	20,941		22,845		42,534		50,177
Earnings from continuing operations	66,233		63,596		130,144		146,351
Earnings from discontinued operations before income taxes	197		301		447		1,196
Income taxes	73		99		141		401
Earnings from discontinued operations	124		202		306		795
Net earnings	$	66,357	$	63,798	$	130,450	$	147,146
Basic earnings per share*
Earnings from continuing operations	$	0.55	$	0.53	$	1.08	$	1.23
Earnings from discontinued operations	—		—		—		0.01
Net earnings	$	0.55	$	0.54	$	1.09	$	1.24
Diluted earnings per share*
Earnings from continuing operations	$	0.54	$	0.53	$	1.07	$	1.22
Earnings from discontinued operations	—		—		—		0.01
Net earnings	$	0.55	$	0.53	$	1.07	$	1.22
Average basic shares outstanding	120,345,432		118,919,455		120,052,459		118,644,823
Average diluted shares outstanding	121,751,859		120,407,256		121,672,194		120,303,259

See notes to condensed consolidated financial statements.

 _________________

*Earnings Per Share ("EPS") is calculated independently for each component and may not sum to Net EPS due to rounding.

3

COMMERCIAL METALS COMPANY AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (UNAUDITED)
	Three Months Ended				Six Months Ended
(in thousands)	February 28, 2021		February 29, 2020		February 28, 2021		February 29, 2020
Net earnings	$	66,357	$	63,798	$	130,450	$	147,146
Other comprehensive income (loss), net of income taxes:
Foreign currency translation adjustment	1,465		(1,068)		(6,923)		5,856
Net unrealized gain (loss) on derivatives:
Unrealized holding gain (loss)	7,723		(3,646)		8,887		(2,932)
Reclassification for gain included in net earnings	(259)		(83)		(313)		(172)
Net unrealized gain (loss) on derivatives	7,464		(3,729)		8,574		(3,104)
Defined benefit obligation:
Amortization of prior services	(14)		(8)		(27)		(16)
Defined benefit obligation	(14)		(8)		(27)		(16)
Other comprehensive income (loss)	8,915		(4,805)		1,624		2,736
Comprehensive income	$	75,272	$	58,993	$	132,074	$	149,882

See notes to condensed consolidated financial statements.

4

COMMERCIAL METALS COMPANY AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)
(in thousands, except share data)	February 28, 2021		August 31, 2020
Assets
Current assets:
Cash and cash equivalents	$	367,347	$	542,103
Accounts receivable (less allowance for doubtful accounts of $7,623 and $9,597)	895,604		880,728
Inventories, net	776,561		625,393
Prepaid and other current assets	166,124		165,879
Total current assets	2,205,636		2,214,103
Property, plant and equipment, net	1,557,143		1,571,067
Goodwill	66,235		64,321
Other noncurrent assets	235,027		232,237
Total assets	$	4,064,041	$	4,081,728
Liabilities and stockholders' equity
Current liabilities:
Accounts payable	$	309,413	$	266,102
Accrued expenses and other payables	341,903		461,012
Current maturities of long-term debt and short-term borrowings	22,777		18,149
Total current liabilities	674,093		745,263
Deferred income taxes	126,789		130,810
Other noncurrent liabilities	242,632		250,706
Long-term debt	1,011,035		1,065,536
Total liabilities	2,054,549		2,192,315
Commitments and contingencies (Note 13)
Stockholders' equity:
Common stock, par value $0.01 per share; authorized 200,000,000 shares; issued 129,060,664 shares; outstanding 120,508,215 and 119,220,905 shares	1,290		1,290
Additional paid-in capital	354,620		358,912
Accumulated other comprehensive loss	(102,140)		(103,764)
Retained earnings	1,909,443		1,807,826
Less treasury stock 8,552,449 and 9,839,759 shares at cost	(153,952)		(175,063)
Stockholders' equity	2,009,261		1,889,201
Stockholders' equity attributable to noncontrolling interests	231		212
Total equity	2,009,492		1,889,413
Total liabilities and stockholders' equity	$	4,064,041	$	4,081,728

See notes to condensed consolidated financial statements.

5

COMMERCIAL METALS COMPANY AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
	Six Months Ended
(in thousands)	February 28, 2021		February 29, 2020
Cash flows from (used by) operating activities:
Net earnings	$	130,450	$	147,146
Adjustments to reconcile net earnings to cash flows from (used by) operating activities:
Depreciation and amortization	83,372		82,338
Stock-based compensation	21,758		15,805
Loss on debt extinguishment	16,841		—
Deferred income taxes and other long-term taxes	(8,129)		42,142
Net gain on disposals of subsidiaries, assets and other	(5,481)		(5,585)
Asset impairments	4,068		530
Amortization of acquired unfavorable contract backlog	(3,032)		(14,328)
Other	(105)		1,041
Changes in operating assets and liabilities	(238,539)		(15,673)
Net cash flows from operating activities	1,203		253,416
Cash flows from (used by) investing activities:
Capital expenditures	(87,688)		(96,592)
Proceeds from the sale of property, plant and equipment and other	20,338		14,004
Acquisitions, net of cash acquired	—		(9,850)
Proceeds from insurance	—		974
Net cash flows used by investing activities:	(67,350)		(91,464)
Cash flows from (used by) financing activities:
Proceeds from issuance of long-term debt, net	296,250		11,299
Repayments of long-term debt	(357,792)		(106,880)
Debt extinguishment costs	(13,051)		—
Debt issuance costs	(1,124)		—
Proceeds from accounts receivable programs	8,848		85,686
Repayments under accounts receivable programs	(8,848)		(81,314)
Dividends	(28,833)		(28,480)
Stock issued under incentive and purchase plans, net of forfeitures	(4,536)		(2,463)
Contribution from noncontrolling interest	19		16
Net cash flows used by financing activities	(109,067)		(122,136)
Effect of exchange rate changes on cash	(419)		337
Increase (decrease) in cash, restricted cash and cash equivalents	(175,633)		40,153
Cash, restricted cash and cash equivalents at beginning of period	544,964		193,729
Cash, restricted cash and cash equivalents at end of period	$	369,331	$	233,882

See notes to condensed consolidated financial statements.

Supplemental information:	Six Months Ended
(in thousands)	February 28, 2021		February 29, 2020
Cash paid for income taxes	$	48,757	$	27,759
Cash paid for interest	34,094		29,484
Noncash activities:
Liabilities related to additions of property, plant and equipment	16,252		29,176
Cash and cash equivalents	367,347		232,442
Restricted cash	1,984		1,440
Total cash, cash equivalents and restricted cash	$	369,331	$	233,882

6

COMMERCIAL METALS COMPANY AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (UNAUDITED)
	Three Months Ended February 28, 2021
	Common Stock			Additional		Accumulated Other				Treasury Stock			Non-
(in thousands, except share data)	Number of Shares	Amount		Paid-In Capital		Comprehensive Loss		Retained Earnings		Number of Shares	Amount		controlling Interest		Total
Balance, December 1, 2020	129,060,664	$	1,290	$	348,816	$	(111,055)	$	1,857,513	(8,992,643)	$	(161,877)	$	212	$	1,934,899
Net earnings								66,357							66,357
Other comprehensive income						8,915									8,915
Dividends ($0.12 per share)								(14,427)							(14,427)
Issuance of stock under incentive and purchase plans, net of forfeitures				(2,120)						440,194	7,925				5,805
Stock-based compensation				7,924											7,924
Contribution of noncontrolling interest													19		19
Balance, February 28, 2021	129,060,664	$	1,290	$	354,620	$	(102,140)	$	1,909,443	(8,552,449)	$	(153,952)	$	231	$	2,009,492
	Six Months Ended February 28, 2021
	Common Stock			Additional		Accumulated Other				Treasury Stock			Non-
(in thousands, except share data)	Number of Shares	Amount		Paid-In Capital		Comprehensive Loss		Retained Earnings		Number of Shares	Amount		controlling Interest		Total
Balance, September 1, 2020	129,060,664	$	1,290	$	358,912	$	(103,764)	$	1,807,826	(9,839,759)	$	(175,063)	$	212	$	1,889,413
Net earnings								130,450							130,450
Other comprehensive income						1,624									1,624
Dividends ($0.24 per share)								(28,833)							(28,833)
Issuance of stock under incentive and purchase plans, net of forfeitures				(25,647)						1,287,310	21,111				(4,536)
Stock-based compensation				15,935											15,935
Contribution of noncontrolling interest													19		19
Reclassification of share-based liability awards				5,420											5,420
Balance, February 28, 2021	129,060,664	$	1,290	$	354,620	$	(102,140)	$	1,909,443	(8,552,449)	$	(153,952)	$	231	$	2,009,492

7

	Three Months Ended February 29, 2020
	Common Stock			Additional		Accumulated Other				Treasury Stock			Non-
(in thousands, except share data)	Number of Shares	Amount		Paid-In Capital		Comprehensive Loss		Retained Earnings		Number of Shares	Amount		controlling Interest		Total
Balance, December 1, 2019	129,060,664	$	1,290	$	347,192	$	(116,585)	$	1,654,489	(10,410,799)	$	(184,885)	$	196	$	1,701,697
Net earnings								63,798							63,798
Other comprehensive loss						(4,805)									(4,805)
Dividends ($0.12 per share)								(14,242)							(14,242)
Issuance of stock under incentive and purchase plans, net of forfeitures				(1,948)						412,024	7,302				5,354
Stock-based compensation				6,237											6,237
Contribution of noncontrolling interest													16		16
Balance, February 29, 2020	129,060,664	$	1,290	$	351,481	$	(121,390)	$	1,704,045	(9,998,775)	$	(177,583)	$	212	$	1,758,055
	Six Months Ended February 29, 2020
	Common Stock			Additional		Accumulated Other				Treasury Stock			Non-
(in thousands, except share data)	Number of Shares	Amount		Paid-In Capital		Comprehensive Loss		Retained Earnings		Number of Shares	Amount		controlling Interest		Total
Balance, September 1, 2019	129,060,664	$	1,290	$	358,668	$	(124,126)	$	1,585,379	(11,135,726)	$	(197,350)	$	196	$	1,624,057
Net earnings								147,146							147,146
Other comprehensive income						2,736									2,736
Dividends ($0.24 per share)								(28,480)							(28,480)
Issuance of stock under incentive and purchase plans, net of forfeitures				(22,230)						1,136,951	19,767				(2,463)
Stock-based compensation				12,533											12,533
Contribution of noncontrolling interest													16		16
Reclassification of share-based liability awards				2,510											2,510
Balance, February 29, 2020	129,060,664	$	1,290	$	351,481	$	(121,390)	$	1,704,045	(9,998,775)	$	(177,583)	$	212	$	1,758,055

See notes to condensed consolidated financial statements.

8

COMMERCIAL METALS COMPANY AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

NOTE 1. ACCOUNTING POLICIES

Basis of Presentation

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States ("GAAP") on a basis consistent with that used in the Annual Report on Form 10-K for the year ended August 31, 2020 ("2020 Form 10-K") filed by Commercial Metals Company ("CMC," and together with its consolidated subsidiaries, the "Company") with the Securities and Exchange Commission (the "SEC") and include all normal recurring adjustments necessary to present fairly the condensed consolidated balance sheets and the condensed consolidated statements of earnings, comprehensive income, cash flows and stockholders' equity for the periods indicated. These notes should be read in conjunction with the consolidated financial statements included in the 2020 Form 10-K. The results of operations for the three and six month periods are not necessarily indicative of the results to be expected for the full fiscal year. Any reference in this Form 10-Q to the "corresponding period" relates to the relevant three or six month period ended February 29, 2020.

Any reference in this Form 10-Q to a year refers to the fiscal year ended August 31st of that year, unless otherwise noted.

NOTE 2. CHANGES IN BUSINESS

Facility Closures and Dispositions

In October 2019, the Company closed the melting operations at its Rancho Cucamonga facility, which is part of the North America segment. In August 2020, the Company announced plans to sell the Rancho Cucamonga site and the Company ceased operations at this facility in January 2021. As a result, the Company recorded $5.4 million and $13.4 million of expense in the three and six months ended February 28, 2021, respectively, and $6.3 million of expense in the six months ended February 29, 2020, all of which was recorded in the first quarter of 2020, related to asset impairments, severance, pension curtailment, environmental obligations and vendor agreement terminations. The disposition does not meet the criteria for discontinued operations, and as of February 28, 2021, does not qualify for held for sale accounting.

9

NOTE 3. ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)

The following tables reflect the changes in accumulated other comprehensive income (loss) ("AOCI"):

	Three Months Ended February 28, 2021
(in thousands)	Foreign Currency Translation		Unrealized Gain (Loss) on Derivatives		Defined Benefit Obligation		Total AOCI
Balance, December 1, 2020	$	(96,321)	$	(10,224)	$	(4,510)	$	(111,055)
Other comprehensive income (loss) before reclassifications	1,465		9,535		(14)		10,986
Amounts reclassified from AOCI	—		(320)		—		(320)
Income taxes	—		(1,751)		—		(1,751)
Net other comprehensive income (loss)	1,465		7,464		(14)		8,915
Balance, February 28, 2021	$	(94,856)	$	(2,760)	$	(4,524)	$	(102,140)
	Six Months Ended February 28, 2021
(in thousands)	Foreign Currency Translation		Unrealized Gain (Loss) on Derivatives		Defined Benefit Obligation		Total AOCI
Balance, September 1, 2020	$	(87,933)	$	(11,334)	$	(4,497)	$	(103,764)
Other comprehensive income (loss) before reclassifications	(6,923)		10,972		(34)		4,015
Amounts reclassified from AOCI	—		(387)		—		(387)
Income taxes	—		(2,011)		7		(2,004)
Net other comprehensive income (loss)	(6,923)		8,574		(27)		1,624
Balance, February 28, 2021	$	(94,856)	$	(2,760)	$	(4,524)	$	(102,140)

	Three Months Ended February 29, 2020
(in thousands)	Foreign Currency Translation		Unrealized Gain (Loss) on Derivatives		Defined Benefit Obligation		Total AOCI
Balance, December 1, 2019	$	(114,574)	$	1,731	$	(3,742)	$	(116,585)
Other comprehensive loss before reclassifications	(1,066)		(4,501)		(14)		(5,581)
Amounts reclassified from AOCI	(2)		(104)		—		(106)
Income taxes	—		876		6		882
Net other comprehensive loss	(1,068)		(3,729)		(8)		(4,805)
Balance, February 29, 2020	$	(115,642)	$	(1,998)	$	(3,750)	$	(121,390)
	Six Months Ended February 29, 2020
(in thousands)	Foreign Currency Translation		Unrealized Gain (Loss) on Derivatives		Defined Benefit Obligation		Total AOCI
Balance, September 1, 2019	$	(121,498)	$	1,106	$	(3,734)	$	(124,126)
Other comprehensive income (loss) before reclassifications	5,858		(3,619)		(24)		2,215
Amounts reclassified from AOCI	(2)		(214)		—		(216)
Income taxes	—		729		8		737
Net other comprehensive income (loss)	5,856		(3,104)		(16)		2,736
Balance, February 29, 2020	$	(115,642)	$	(1,998)	$	(3,750)	$	(121,390)

Items reclassified out of AOCI were immaterial for the three and six months ended February 28, 2021 and February 29, 2020. Thus, the corresponding line items in the condensed consolidated statements of earnings to which the items were reclassified are not presented.

10

NOTE 4. REVENUE RECOGNITION

Each fabricated product contract sold by the North America segment represents a single performance obligation. Revenue from contracts where the Company provides fabricated product and installation services is recognized over time using an input measure, and these contracts represented 11% and 12% of net sales in the North America segment in the three and six months ended February 28, 2021, respectively. Revenue from contracts where the Company does not provide installation services is recognized over time using an output measure, and these contracts represented 9% of net sales in the North America segment in both the three and six months ended February 28, 2021. The remaining 80% and 79% of net sales in the North America segment were recognized at a point in time concurrent with the transfer of control, or as amounts were billed to the customer under an available practical expedient, in the three and six months ended February 28, 2021, respectively.

The following table provides information about assets and liabilities from contracts with customers.

(in thousands)	February 28, 2021		August 31, 2020
Contract assets (included in accounts receivable)	$	54,468	$	53,275
Contract liabilities (included in accrued expenses and other payables)	18,638		25,450

During the six months ended February 28, 2021, approximately $21.3 million was recognized in the condensed consolidated statements of earnings related to August 31, 2020 contract liabilities.

Remaining Performance Obligations

Remaining performance obligations represent the transaction price of fabricated product contracts where revenue is recognized using an input or output measure for which work has not yet been performed. As of February 28, 2021, $688.3 million was allocated to remaining performance obligations in the North America segment related to those contracts.

NOTE 5. INVENTORIES, NET

The majority of the Company's inventories are in the form of semi-finished and finished goods. Under the Company’s business model, products are sold to external customers in various stages, from semi-finished billets through fabricated steel, leading these categories to be combined. As such, at February 28, 2021 and August 31, 2020, work in process inventories were immaterial. At February 28, 2021 and August 31, 2020, the Company's raw materials inventories were $213.3 million and $123.9 million, respectively.

NOTE 6. GOODWILL AND OTHER INTANGIBLES

Goodwill by reportable segment at February 28, 2021 is detailed in the following table:

(in thousands)	North America		Europe		Consolidated
Goodwill, gross*	$	71,941	$	4,491	$	76,432
Accumulated impairment losses*	(10,036)		(161)		(10,197)
Goodwill, net*	$	61,905	$	4,330	$	66,235

_________________ 

* The change in balance from August 31, 2020 was immaterial.

The total gross carrying amounts of the Company's intangible assets subject to amortization were $21.8 million and $22.1 million, and the total net carrying amounts were $11.4 million and $12.6 million at February 28, 2021 and August 31, 2020, respectively. These assets were included in other noncurrent assets on the Company's condensed consolidated balance sheets. Intangible amortization expense from continuing operations related to such intangible assets was immaterial for the three and six months ended February 28, 2021 and February 29, 2020. Excluding goodwill, the Company did not have any significant intangible assets with indefinite lives at February 28, 2021.

At February 28, 2021 and August 31, 2020, the net carrying amount of the acquired unfavorable contract backlog liability was $3.0 million and $6.0 million, respectively. Amortization of the acquired unfavorable contract backlog was $1.5 million and $3.0 million for the three and six months ended February 28, 2021, respectively, and $6.0 million and $14.3 million for the

11

corresponding periods, and was recorded as an increase to net sales in the Company’s condensed consolidated statements of earnings.

NOTE 7. LEASES

The following table presents the components of the total leased assets and lease liabilities and their classification in the Company's condensed consolidated balance sheets:

(in thousands)	Classification in Condensed Consolidated Balance Sheets	February 28, 2021		August 31, 2020
Assets:
Operating assets	Other noncurrent assets	$	117,547	$	114,905
Finance assets	Property, plant and equipment, net	52,325		50,642
Total leased assets		$	169,872	$	165,547
Liabilities:
Operating lease liabilities:
Current	Accrued expenses and other payables	$	27,176	$	27,604
Long-term	Other noncurrent liabilities	98,807		95,810
Total operating lease liabilities		125,983		123,414
Finance lease liabilities:
Current	Current maturities of long-term debt and short-term borrowings	15,228		14,373
Long-term	Long-term debt	35,992		35,851
Total finance lease liabilities		51,220		50,224
Total lease liabilities		$	177,203	$	173,638

The components of lease cost were as follows:

	Three Months Ended				Six Months Ended
(in thousands)	February 28, 2021		February 29, 2020		February 28, 2021		February 29, 2020
Operating lease expense	$	8,651	$	8,815	$	17,373	$	17,605
Finance lease expense:
Amortization of assets	3,219		2,720		6,458		4,885
Interest on lease liabilities	563		465		1,118		866
Total finance lease expense	3,782		3,185		7,576		5,751
Variable and short-term lease expense	4,324		4,381		9,286		8,314
Total lease expense	$	16,757	$	16,381	$	34,235	$	31,670

The weighted average remaining lease term and discount rate for operating and finance leases are presented in the following table:

	February 28, 2021		August 31, 2020
Weighted average remaining lease term (years)
Operating leases	6.4		6.3
Finance leases	3.6		3.8
Weighted average discount rate
Operating leases	4.482	%	4.283	%
Finance leases	4.296	%	4.270	%

12

Cash flow and other information related to leases is included in the following table:

	Six Months Ended
(in thousands)	February 28, 2021		February 29, 2020
Cash paid for amounts included in the measurement of lease liabilities
Operating cash outflows from operating leases	$	17,812	$	17,594
Operating cash outflows from finance leases	1,125		787
Financing cash outflows from finance leases	7,761		6,426
Right of use ("ROU") assets obtained in exchange for lease obligations:
Operating leases	20,249		28,942
Finance leases	8,784		13,040

Maturities of lease liabilities at February 28, 2021 are presented in the following table:

(in thousands)	Operating Leases		Finance Leases
Year 1	$	32,387	$	17,138
Year 2	26,877		14,767
Year 3	22,162		12,336
Year 4	17,182		8,716
Year 5	12,921		2,392
Thereafter	35,374		97
Total lease payments	146,903		55,446
Less: Imputed interest	20,920		4,226
Present value of lease liabilities	$	125,983	$	51,220

NOTE 8. CREDIT ARRANGEMENTS

Long-term debt was as follows: 

(in thousands)	Weighted Average Interest Rate as of February 28, 2021	February 28, 2021		August 31, 2020
2031 Notes	3.875%	$	300,000	$	—
2027 Notes	5.375%	300,000		300,000
2026 Notes	5.750%	—		350,000
2023 Notes	4.875%	330,000		330,000
Poland Term Loan	1.710%	40,068		40,713
Other	5.100%	21,329		21,329
Finance leases		51,220		50,224
Total debt		1,042,617		1,092,266
Less debt issuance costs		8,805		8,581
Total amounts outstanding		1,033,812		1,083,685
Less current maturities of long-term debt		22,777		18,149
Long-term debt		$	1,011,035	$	1,065,536

In February 2021, the Company issued $300.0 million of 3.875% Senior Notes due February 2031 (the "2031 Notes"). Issuance costs associated with the 2031 Notes were approximately $4.9 million. Interest on the 2031 Notes is payable semiannually.

In May 2018, the Company issued $350.0 million of 5.750% Senior Notes due April 2026 (the "2026 Notes"). In February 2021, the Company accepted for purchase approximately $77.8 million of the outstanding principal amount of the 2026 Notes

13

through a cash tender offer. Following the expiration of the cash tender offer on February 18, 2021, the Company redeemed the remaining outstanding principal amount of the 2026 Notes. In the three and six month periods ended February 28, 2021, the Company recognized a $16.8 million loss on debt extinguishment related to the retirement of the 2026 Notes.

The Company had no amounts drawn under its $350.0 million revolving credit facility (the "Revolver") at February 28, 2021 and August 31, 2020. The availability under the Revolver was reduced by outstanding stand-by letters of credit totaling $3.0 million at February 28, 2021 and August 31, 2020.

The Company has a Term Loan facility (the "Poland Term Loan") through its subsidiary, CMC Poland Sp. z.o.o. ("CMCP"), which allows for a maximum aggregate principal amount of Polish zloty ("PLN") 250.0 million, or $66.8 million, at February 28, 2021. At February 28, 2021 and August 31, 2020, PLN 150.0 million, or $40.1 million, and PLN 150.0 million, or $40.7 million, respectively, was outstanding.

The Company also has credit facilities in Poland through its subsidiary CMCP. At February 28, 2021, CMCP's credit facilities totaled PLN 275.0 million, or $73.5 million. These facilities expire in March 2022. No amounts were outstanding under these facilities as of February 28, 2021 or August 31, 2020. The available balance of these credit facilities was reduced by outstanding stand-by letters of credit, guarantees, and/or other financial assurance instruments, which totaled $0.9 million and $0.8 million at February 28, 2021 and August 31, 2020, respectively.

The Company's debt agreements require compliance with certain non-financial and financial covenants, including an interest coverage ratio and a debt to capitalization ratio. At February 28, 2021, the Company was in compliance with all covenants contained in its debt agreements.

Accounts Receivable Facilities

The Company had no advance payments outstanding under its U.S. accounts receivable facility at February 28, 2021 or August 31, 2020.

The Poland accounts receivable facility has a limit of PLN 220.0 million, or $58.8 million at February 28, 2021. The Company had no advance payments outstanding under the Poland accounts receivable facility at February 28, 2021 or August 31, 2020.

NOTE 9. DERIVATIVES

The Company's global operations and product lines expose it to risks from fluctuations in metal commodity prices, foreign currency exchange rates, interest rates and natural gas, electricity and other energy prices. One objective of the Company's risk management program is to mitigate these risks using derivative instruments. The Company enters into (i) metal commodity futures and forward contracts to mitigate the risk of unanticipated changes in gross margin due to price volatility in these commodities, (ii) foreign currency forward contracts that match the expected settlements for purchases and sales denominated in foreign currencies and (iii) energy derivatives to mitigate the risk related to price volatility of electricity and natural gas.

At February 28, 2021, the notional values of the Company's foreign currency and commodity commitments were $165.8 million and $217.2 million, respectively. At August 31, 2020, the notional values of the Company's foreign currency and commodity contract commitments were $138.5 million and $195.8 million, respectively.

The following table provides information regarding the Company's commodity contract commitments at February 28, 2021:

Commodity	Long/Short	Total
Aluminum	Long	3,350	MT
Aluminum	Short	1,675	MT
Copper	Long	1,077	MT
Copper	Short	7,836	MT
Electricity	Long	1,967,000	MW(h)

_________________ 

MT = Metric Ton

MW(h) = Megawatt hour

The Company designates only those contracts which closely match the terms of the underlying transaction as hedges for accounting purposes. Certain foreign currency and commodity contracts were not designated as hedges for accounting

14

purposes, although management believes they are essential economic hedges.

Commodity derivatives not designated as hedging instruments resulted in a loss, before income taxes, of $11.0 million and $16.6 million, in the three and six months ended February 28, 2021, respectively, and a gain, before income taxes, of $1.7 million and $0.4 million in the three and six months ended February 29, 2020, respectively, primarily recorded in cost of goods sold within the condensed consolidated statements of earnings. Foreign exchange derivatives accounted for as cash flow hedging instruments resulted in a net gain of $7.7 million and $8.9 million, in the three and six months ended February 28, 2021, respectively, and a net loss of $3.6 million and $2.9 million in the three and six months ended February 29, 2020, respectively, recognized in the condensed consolidated statements of comprehensive income (loss). See Note 10, Fair Value, for the fair value of the Company's derivative instruments recorded in the condensed consolidated balance sheets.

NOTE 10. FAIR VALUE

The Company has established a fair value hierarchy which prioritizes the inputs to the valuation techniques used to measure fair value into three levels. These levels are determined based on the lowest level input that is significant to the fair value measurement. Levels within the hierarchy are defined within the Summary of Significant Accounting Policies footnote in our 2020 Form 10-K.

The following tables summarize information regarding the Company's financial assets and financial liabilities that were measured at fair value on a recurring basis:

			Fair Value Measurements at Reporting Date Using
(in thousands)	February 28, 2021		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant  Other Observable Inputs (Level 2)		Significant Unobservable  Inputs (Level 3)
Assets:
Investment deposit accounts (1)	$	345,240	$	345,240	$	—	$	—
Commodity derivative assets (2)	1,091		1,091		—		—
Foreign exchange derivative assets (2)	1,301		—		1,301		—
Liabilities:
Commodity derivative liabilities (2)	11,349		7,064		—		4,285
Foreign exchange derivative liabilities (2)	635		—		635		—

			Fair Value Measurements at Reporting Date Using
(in thousands)	August 31, 2020		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant  Other Observable Inputs (Level 2)		Significant Unobservable  Inputs (Level 3)
Assets:
Investment deposit accounts (1)	$	449,824	$	449,824	$	—	$	—
Commodity derivative assets (2)	202		202		—		—
Foreign exchange derivative assets (2)	1,484		—		1,484		—
Liabilities:
Commodity derivative liabilities (2)	19,000		3,993		—		15,007
Foreign exchange derivative liabilities (2)	459		—		459		—

_________________ 

(1) Investment deposit accounts are short-term in nature, and the value is determined by principal plus interest. The investment portfolio mix can change each period based on the Company's assessment of investment options.

(2) Derivative assets and liabilities classified as Level 1 are commodity futures contracts valued based on quoted market prices in the London Metal Exchange or New York Mercantile Exchange. Amounts in Level 2 are based on broker quotes in the over-the-counter market. Derivatives classified as Level 3 are described below. Further discussion regarding the Company's use of derivative instruments is included in Note 9, Derivatives.

15

The fair value estimate of the Level 3 commodity derivative is based on an internally developed discounted cash flow model primarily utilizing unobservable inputs in which there is little or no market data. The Company forecasts future energy rates using a range of historical prices ("floating rate"). The floating rate is the only significant unobservable input used in the Company's discounted cash flow model.

	February 28, 2021
Unobservable Inputs	Low	High	Average
Floating rate (PLN)	151.74	264.53	221.74

Below is a reconciliation of the beginning and ending balances of the Level 3 commodity derivative recognized in the condensed consolidated statements of comprehensive income. The fluctuation in energy rates over time may cause volatility in the fair value estimate and is the primary reason for the unrealized gain in other comprehensive income ("OCI") in the three and six months ended February 28, 2021.

(in thousands)	Three Months Ended February 28, 2021
Balance, December 1, 2020	$	(13,614)
Total gains, realized and unrealized
Recognized in net earnings(1)	253
Recognized in OCI(2)	9,076
Balance, February 28, 2021	$	(4,285)
(in thousands)	Six Months Ended February 28, 2021
Balance, September 1, 2020	$	(15,007)
Total gains, realized and unrealized
Recognized in net earnings(1)	253
Recognized in OCI(2)	10,469
Balance, February 28, 2021	$	(4,285)

_________________

(1)    Gains recognized in net earnings are included in cost of goods sold in the condensed consolidated statements of earnings.

(2)    Gains recognized in OCI are included in the unrealized holding gain in the condensed consolidated statements of comprehensive income (loss).

There were no material non-recurring fair value remeasurements during the three and six months ended February 28, 2021 or February 29, 2020.

The carrying values of the Company's short-term items approximate fair value.

The carrying values and estimated fair values of the Company's financial assets and liabilities that are not required to be measured at fair value on the condensed consolidated balance sheets were as follows:

		February 28, 2021				August 31, 2020
(in thousands)	Fair Value Hierarchy	Carrying Value		Fair Value		Carrying Value		Fair Value
2031 Notes (1)	Level 2	$	300,000	$	301,674	$	—	$	—
2027 Notes (1)	Level 2	300,000		319,428		300,000		319,377
2026 Notes (1)	Level 2	—		—		350,000		367,374
2023 Notes (1)	Level 2	330,000		349,104		330,000		345,335
Poland Term Loan(2)	Level 2	40,068		40,068		40,713		40,713

_________________ 

(1) The fair value of the notes was determined based on indicated market values.

(2) The Poland Term Loan contains variable interest rates, and as a result, the carrying value approximates fair value.

16

NOTE 11. STOCK-BASED COMPENSATION PLANS

The Company's stock-based compensation plans are described in Note 15, Stock-Based Compensation Plans, to the consolidated financial statements in the 2020 Form 10-K. In general, restricted stock units granted in 2021 vest ratably over a period of three years. Subject to the achievement of performance targets established by the Compensation Committee of CMC's Board of Directors, performance stock units granted in 2021 vest after a period of three years.

During the six months ended February 28, 2021 and February 29, 2020, the Company granted the following awards under its stock-based compensation plans:

	February 28, 2021			February 29, 2020
(in thousands, except per share data)	Shares Granted	Weighted Average Grant Date Fair Value		Shares Granted	Weighted Average Grant Date Fair Value
Equity method	1,512	$	20.51	1,521	$	18.32
Liability method	324	N/A		426	N/A

During the three and six months ended February 28, 2021 and February 29, 2020, the Company recorded immaterial mark-to-market adjustments on liability awards. At February 28, 2021, the Company had outstanding 711,648 equivalent shares accounted for under the liability method. The Company expects 676,065 equivalent shares to vest.

The following table summarizes total stock-based compensation expense, including fair value remeasurements, which was primarily included in selling, general and administrative expenses on the Company's condensed consolidated statements of earnings:

	Three Months Ended				Six Months Ended
(in thousands)	February 28, 2021		February 29, 2020		February 28, 2021		February 29, 2020
Stock-based compensation expense	$	12,696	$	7,536	$	21,758	$	15,805

NOTE 12. STOCKHOLDERS' EQUITY AND EARNINGS PER SHARE

The calculations of basic and diluted earnings per share from continuing operations were as follows: 

	Three Months Ended				Six Months Ended
(in thousands, except share data)	February 28, 2021		February 29, 2020		February 28, 2021		February 29, 2020
Earnings from continuing operations	$	66,233	$	63,596	$	130,144	$	146,351
Basic earnings per share:
Shares outstanding for basic earnings per share	120,345,432		118,919,455		120,052,459		118,644,823
Basic earnings per share from continuing operations	$	0.55	$	0.53	$	1.08	$	1.23
Diluted earnings per share:
Shares outstanding for basic earnings per share	120,345,432		118,919,455		120,052,459		118,644,823
Effect of dilutive securities:
Stock-based incentive/purchase plans	1,406,427		1,487,801		1,619,735		1,658,436
Shares outstanding for diluted earnings per share	121,751,859		120,407,256		121,672,194		120,303,259
Diluted earnings per share from continuing operations	$	0.54	$	0.53	$	1.07	$	1.22

Anti-dilutive shares not included above were immaterial for all periods presented.

Restricted stock is included in the number of shares of common stock issued and outstanding, but omitted from the basic earnings per share calculation until the shares vest.

During the first quarter of 2015, CMC's Board of Directors authorized a share repurchase program under which CMC may repurchase up to $100.0 million of shares of common stock. During the three and six months ended February 28, 2021, CMC did not repurchase any shares of common stock. CMC had remaining authorization to repurchase $27.6 million of common stock at February 28, 2021.

17

NOTE 13. COMMITMENTS AND CONTINGENCIES

Legal and Environmental Matters

In the ordinary course of conducting its business, the Company becomes involved in litigation, administrative proceedings and governmental investigations, including environmental matters. See Note 19, Commitments and Contingencies, to the consolidated financial statements in the 2020 Form 10-K.

The Company has received notices from the U.S. Environmental Protection Agency ("EPA") or state agencies with similar responsibility that it is considered a potentially responsible party at several sites, none of which are owned by the Company, and may be obligated under the Comprehensive Environmental Response, Compensation and Liability Act of 1980 ("CERCLA") or similar state statutes to conduct remedial investigations, feasibility studies, remediation and/or removal of alleged releases of hazardous substances or to reimburse the EPA for such activities. The Company is involved in litigation or administrative proceedings with regard to several of these sites in which the Company is contesting, or at the appropriate time may contest, its liability at the sites. In addition, the Company has received information requests with regard to other sites which may be under consideration by the EPA as potential CERCLA sites. Some of these environmental matters or other proceedings may result in fines, penalties or judgments being assessed against the Company. At February 28, 2021 and August 31, 2020, the amounts accrued for cleanup and remediation costs in connection with CERCLA sites were immaterial. The estimation process is based on currently available information which is, in many cases, preliminary and incomplete. Total environmental liabilities, including CERCLA sites, were $6.8 million and $3.4 million at February 28, 2021 and August 31, 2020, respectively, of which $2.4 million and $2.7 million were classified as other long-term liabilities at February 28, 2021 and August 31, 2020, respectively. Due to evolving remediation technology, changing regulations, possible third-party contributions, the inherent shortcomings of the estimation process and other factors, amounts accrued could vary significantly from amounts paid. Historically, the amounts the Company has ultimately paid for such remediation activities have not been material.

Management believes that adequate provisions have been made in the Company's condensed consolidated financial statements for the potential impact of these contingencies, and that the outcomes of the suits and proceedings described above, and other miscellaneous litigation and proceedings now pending, will not have a material adverse effect on the business, results of operations or financial condition of the Company.

NOTE 14. BUSINESS SEGMENTS

The Company structures its business into two reportable segments: North America and Europe. See Note 1, Nature of Operations, in the 2020 Form 10-K for more information about the reportable segments, including the types of products and services from which each reportable segment derives its net sales. Corporate and Other contains earnings or losses on assets and liabilities related to the Company's Benefit Restoration Plan assets and short-term investments, expenses of the Company's corporate headquarters, interest expense related to its long-term debt and intercompany eliminations.

The following is a summary of certain financial information from continuing operations by reportable segment:

	Three Months Ended February 28, 2021
(in thousands)	North America		Europe		Corporate and Other		Continuing Operations
Net sales	$	1,257,486	$	202,066	$	2,718	$	1,462,270
Adjusted EBITDA	171,612		16,107		(45,986)		141,733
	Six Months Ended February 28, 2021
(in thousands)	North America		Europe		Corporate and Other		Continuing Operations
Net sales	$	2,452,499	$	396,662	$	4,912	$	2,854,073
Adjusted EBITDA	327,246		30,577		(72,457)		285,366
Total assets at February 28, 2021*	2,957,534		566,195		540,312		4,064,041

18

	Three Months Ended February 29, 2020
(in thousands)	North America		Europe		Corporate and Other		Continuing Operations
Net sales	$	1,161,283	$	180,079	$	(399)	$	1,340,963
Adjusted EBITDA	152,831		13,451		(28,561)		137,721
	Six Months Ended February 29, 2020
(in thousands)	North America		Europe		Corporate and Other		Continuing Operations
Net sales	$	2,378,003	$	345,468	$	2,200	$	2,725,671
Adjusted EBITDA	327,563		24,810		(54,847)		297,526
Total assets at August 31, 2020*	2,862,805		532,850		686,073		4,081,728

_________________ 

*Total assets listed in Corporate and Other includes assets from discontinued operations.

The following table presents a reconciliation of earnings from continuing operations to adjusted EBITDA from continuing operations:

	Three Months Ended				Six Months Ended
(in thousands)	February 28, 2021		February 29, 2020		February 28, 2021		February 29, 2020
Earnings from continuing operations	$	66,233	$	63,596	$	130,144	$	146,351
Interest expense	14,021		15,888		28,280		32,466
Income taxes	20,941		22,845		42,534		50,177
Depreciation and amortization	41,573		41,389		83,372		82,330
Amortization of acquired unfavorable contract backlog	(1,509)		(5,997)		(3,032)		(14,328)
Asset impairments	474		—		4,068		530
Adjusted EBITDA from continuing operations	$	141,733	$	137,721	$	285,366	$	297,526

19

Disaggregation of Revenue

The following tables display revenue by reportable segment from external customers, disaggregated by major source. The Company believes disaggregating by these categories depicts how the nature, amount, timing and uncertainty of revenue and cash flows are affected by economic factors.

	Three Months Ended February 28, 2021
(in thousands)	North America		Europe		Corporate		Total
Major product:
Raw material products	$	255,012	$	4,775	$	—	$	259,787
Steel products	514,201		157,482		—		671,683
Downstream products	400,397		33,762		—		434,159
Other	87,876		5,540		3,225		96,641
Net sales-unaffiliated customers	1,257,486		201,559		3,225		1,462,270
Intersegment net sales, eliminated on consolidation	—		507		(507)		—
Net sales	$	1,257,486	$	202,066	$	2,718	$	1,462,270
	Six Months Ended February 28, 2021
(in thousands)	North America		Europe		Corporate		Total
Major product:
Raw material products	$	465,249	$	7,605	$	—	$	472,854
Steel products	971,858		308,937		—		1,280,795
Downstream products	837,426		68,235		—		905,661
Other	177,966		10,967		5,830		194,763
Net sales-unaffiliated customers	$	2,452,499	$	395,744	$	5,830	$	2,854,073
Intersegment net sales, eliminated on consolidation	—		918		(918)		—
Net sales	$	2,452,499	$	396,662	$	4,912	$	2,854,073

20

	Three Months Ended February 29, 2020
(in thousands)	North America		Europe		Corporate		Total
Major product:
Raw material products	$	193,312	$	2,408	$	—	$	195,720
Steel products	437,648		147,525		—		585,173
Downstream products	441,765		23,758		—		465,523
Other	88,558		5,965		24		94,547
Net sales-unaffiliated customers	1,161,283		179,656		24		1,340,963
Intersegment net sales, eliminated on consolidation	—		423		(423)		—
Net sales	$	1,161,283	$	180,079	$	(399)	$	1,340,963
	Six Months Ended February 29, 2020
(in thousands)	North America		Europe		Corporate		Total
Major product:
Raw material products	$	374,935	$	4,613	$	—	$	379,548
Steel products	878,811		277,269		—		1,156,080
Downstream products	941,492		51,958		—		993,450
Other	182,765		10,856		2,972		196,593
Net sales-unaffiliated customers	2,378,003		344,696		2,972		2,725,671
Intersegment net sales, eliminated on consolidation	—		772		(772)		—
Net sales	$	2,378,003	$	345,468	$	2,200	$	2,725,671

21

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

In the following discussion, references to "we," "us," "our" or the "Company" mean Commercial Metals Company ("CMC") and its consolidated subsidiaries, unless the context otherwise requires. The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our condensed consolidated financial statements and the notes thereto, which are included in this Quarterly Report on Form 10-Q (the "Form 10-Q"), and our consolidated financial statements and the notes thereto, which are included in our Annual Report on Form 10-K for the year ended August 31, 2020 (the "2020 Form 10-K"). This discussion contains or incorporates by reference "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and the Private Securities Litigation Reform Act of 1995. These forward-looking statements are not historical facts, but rather are based on expectations, estimates, assumptions and projections about our industry, business and future financial results, based on information available at the time this Form 10-Q was filed with the Securities and Exchange Commission ("SEC") or, with respect to any document incorporated by reference, available at the time that such document was prepared. Our actual results could differ materially from the results contemplated by these forward-looking statements due to a number of factors, including those identified in the section entitled "Forward-Looking Statements" at the end of Item 2 of this Form 10-Q and in the section entitled "Risk Factors" in Item 1A of the 2020 Form 10-K and this Form 10-Q. We do not undertake any obligation to update, amend or clarify any forward-looking statements to reflect changed assumptions, the occurrence of anticipated or unanticipated events, new information or circumstances or otherwise, except as required by law.

Any reference in this Form 10-Q to the "corresponding period" relates to the three or six month period ended February 29, 2020.

COVID-19 UPDATE

We continue to closely monitor the impact of the COVID-19 pandemic ("COVID-19") on the Company, employees, customers and supply chain. While COVID-19 may have a negative impact on our results of operations, cash flows and financial position, the current level of uncertainty over the economic and operational impacts of COVID-19, the actions to contain the outbreak or treat its impact, and the timing of distribution of COVID-19 vaccines and the economic response thereto means the related financial impact cannot be reasonably estimated at this time.

CRITICAL ACCOUNTING POLICIES

There have been no material changes to our critical accounting policies as set forth in Item 7, Management's Discussion and Analysis of Financial Condition and Results of Operations, included in the 2020 Form 10-K.

RESULTS OF OPERATIONS SUMMARY

Business Overview

As a vertically integrated organization, we manufacture, recycle and fabricate steel and metal products, related materials and services through a network including seven electric arc furnace ("EAF") mini mills, two EAF micro mills, a rerolling mill, steel fabrication and processing plants, construction-related product warehouses, and metal recycling facilities in the U.S. and Poland. Our operations are conducted through two reportable segments: North America and Europe.

When considering our results for the period, we evaluate our operating performance by comparing net sales, in the aggregate and for both of our segments, in the current period to net sales in the corresponding period. In doing so, we focus on changes in average selling price per ton and tons shipped for each of our product categories as these are the two variables that typically have the greatest impact on our results of operations. We group our products into three categories: raw materials, steel products and downstream products. Raw materials include ferrous and nonferrous scrap, steel products include rebar, merchant and other steel products, such as billets and wire rod, and downstream products include fabricated rebar and steel fence post.

We use adjusted EBITDA from continuing operations to compare and evaluate the financial performance of our segments. Adjusted EBITDA is the sum of the Company's earnings from continuing operations before interest expense, income taxes, depreciation and amortization and impairment expense. Although there are many factors that can impact a segment’s adjusted EBITDA and, therefore, our overall earnings, changes in metal margin of our steel products and downstream products period-over-period is a consistent area of focus for our Company and industry. Metal margin is an important metric used by

22

management to monitor the results of our vertically integrated organization. For our steel products, metal margin is the difference between the average selling price per ton of rebar, merchant and other steel products and the cost of ferrous scrap per ton utilized by our steel mills to produce these products. An increase or decrease in input costs can impact profitability of these products when there is no corresponding change in selling prices due to competitive pressures on prices. The metal margin for our downstream products is the difference between the average selling price per ton of fabricated rebar and steel fence post products and the cost of material utilized by our fabrication facilities to produce these products. The majority of our downstream products selling prices per ton are fixed at the beginning of a project and these projects last one to two years on average. Because the selling price generally remains fixed over the life of a project, changes in input costs over the life of the project can significantly impact profitability.

Financial Results Overview

The following discussion of our results of operations is based on our continuing operations and excludes any results of our discontinued operations.

	Three Months Ended				Six Months Ended
(in thousands, except per share data)	February 28, 2021		February 29, 2020		February 28, 2021		February 29, 2020
Net sales	$	1,462,270	$	1,340,963	$	2,854,073	$	2,725,671
Earnings from continuing operations	66,233		63,596		130,144		146,351
Diluted earnings per share	$	0.54	$	0.53	$	1.07	$	1.22

Net sales for the three and six months ended February 28, 2021 increased $121.3 million, or 9%, and $128.4 million, or 5%, respectively, compared to the corresponding periods. The increases were primarily due to year-over-year increases in raw materials average selling prices in our North America segment and in steel products average selling prices in both of our segments.

Earnings from continuing operations for the three and six months ended February 28, 2021 increased $2.6 million and decreased $16.2 million, respectively, compared to the corresponding periods. Earnings in the three months ended February 28, 2021 were relatively flat while earnings in the six months ended February 28, 2021 were impacted by compressed metal margins in the first quarter of 2021 as a result of rising raw material average selling prices while steel products and downstream products average selling prices decreased or remained flat. In the second quarter of 2021, steel products average selling prices, and therefore metal margins, began to increase to offset the higher raw material prices.

Selling, General and Administrative Expenses

Selling, general and administrative expenses were relatively flat for the three and six months ended February 28, 2021 compared to the corresponding periods.

Interest Expense

Interest expense for the three and six months ended February 28, 2021 decreased $1.9 million and $4.2 million, respectively, compared to the corresponding periods. The decreases were driven by a reduction in long-term debt, primarily due to the early repayment of the Term Loan (as defined in Note 10, Credit Arrangements, to the consolidated financial statements in the 2020 Form 10-K) in the year ended August 31, 2020.

Income Taxes

The effective income tax rate from continuing operations for the three and six months ended February 28, 2021 was 24.0% and 24.6%, respectively, compared with 26.4% and 25.5% in the corresponding periods.

SEGMENT OPERATING DATA

Unless otherwise indicated, all dollar amounts below are from continuing operations and calculated before income taxes. See Note 14, Business Segments to our condensed consolidated financial statements for more information. The operational data presented in the tables below is calculated using averages and, therefore, it is not meaningful to quantify the effect that any individual component had on the segment's net sales or adjusted EBITDA.

23

North America

	Three Months Ended				Six Months Ended
(in thousands)	February 28, 2021		February 29, 2020		February 28, 2021		February 29, 2020
Net sales	$	1,257,486	$	1,161,283	$	2,452,499	$	2,378,003
Adjusted EBITDA	171,612		152,831		327,246		327,563
External tons shipped (in thousands)
Raw materials	302		321		632		641
Rebar	472		461		958		936
Merchant and other	268		238		532		474
Steel products	740		699		1,490		1,410
Downstream products	343		366		714		779
Average selling price (per ton)
Steel products	$	695	$	625	$	653	$	625
Downstream products	929		984		931		979
Cost of ferrous scrap utilized per ton	$	344	$	256	$	304	$	238
Steel products metal margin per ton	351		369		349		387

Net sales for the three and six months ended February 28, 2021 increased $96.2 million, or 8%, and $74.5 million, or 3%, respectively, compared to the corresponding periods. The year-over-year increases in net sales were primarily due to $251 and $162 per ton increases in raw materials average selling prices and $70 and $28 per ton increases in steel products average selling prices in the three and six months ended February 28, 2021, respectively, compared to the corresponding periods. Heightened demand from steel producers resulted in higher raw materials average selling prices which drove increases in steel products average selling prices. The increases in net sales as a result of these higher average selling prices were partially offset by $55 and $48 per ton year-over-year decreases in downstream products average selling prices in the three and six months ended February 28, 2021, respectively. Net sales included amortization benefit of $1.5 million and $3.0 million for the three and six months ended February 28, 2021, respectively, and $6.0 million and $14.3 million for the corresponding periods, respectively, related to the acquired unfavorable contract backlog.

Adjusted EBITDA for the three months ended February 28, 2021 increased $18.8 million and was flat for the six months ended February 28, 2021, compared to the corresponding periods. The year-over-year increase in adjusted EBITDA in the three months ended February 28, 2021 was due in part to a 41 thousand ton increase in steel products shipped and significant expansion in raw materials margin. Further, while our steel products metal margin per ton for the three months ended February 28, 2021 contracted $18 per ton compared to the corresponding period, this operating statistic does not fully reflect the margin achieved throughout the period. In times of sharply rising raw material costs and steel products average selling prices, we benefit from selling lower cost inventory produced in prior periods. Adjusted EBITDA did not include the $1.5 million or $3.0 million benefit of the amortization of the acquired unfavorable contract backlog reserve described above. Adjusted EBITDA included non-cash stock compensation expense of $3.8 million and $7.1 million for the three and six months ended February 28, 2021, respectively, and $2.7 million and $5.6 million for the corresponding periods.

24

Europe

	Three Months Ended				Six Months Ended
(in thousands)	February 28, 2021		February 29, 2020		February 28, 2021		February 29, 2020
Net sales	$	202,066	$	180,079	$	396,662	$	345,468
Adjusted EBITDA	16,107		13,451		30,577		24,810
External tons shipped (in thousands)
Rebar	78		145		206		267
Merchant and other	275		235		544		451
Steel products	353		380		750		718
Average selling price (per ton)
Steel products	$	532	$	449	$	495	$	455
Cost of ferrous scrap utilized per ton	$	328	$	251	$	296	$	248
Steel products metal margin per ton	204		198		199		207

Net sales for the three and six months ended February 28, 2021 increased $22.0 million, or 12%, and $51.2 million, or 15%, respectively, compared to the corresponding periods. For the three months ended February 28, 2021, the year-over-year increase in net sales was driven by a $83 per ton increase in steel products average selling prices, partially offset by a 27 thousand ton decrease in steel products shipped. The year-to-date increase in net sales was driven by a 32 thousand ton year-over-year increase in steel products shipments, as demand increased in the first quarter of 2021 due to a resilient Polish construction sector and an upturn in Central European manufacturing activity, coupled with a $40 per ton year-over-year increase in steel products average selling prices. Net sales for the three and six months ended February 28, 2021 were also impacted by favorable foreign currency translation adjustments of $8.3 million and $13.0 million, respectively, due to the decrease in the average value of the U.S. dollar relative to the Polish zloty.

Adjusted EBITDA for the three and six months ended February 28, 2021 increased $2.7 million and $5.8 million, respectively, as compared to the corresponding periods. For the three months ended February 28, 2021, the year-over-year increase in adjusted EBITDA was due, in part, to a $6 per ton increase in steel products metal margin compared to the corresponding period. Similar to the North America segment, we benefited from selling lower cost inventory during the majority of the three month period ended February 28, 2021 in an environment of rising prices, which contributed to the increase in adjusted EBITDA compared to the corresponding period. For the six months ended February 28, 2021, the increase in adjusted EBITDA was primarily due to a 32 thousand ton increase in steel products sold in comparison to the corresponding period. The impact of foreign currency translation to adjusted EBITDA in the three and six months ended February 28, 2021 was immaterial. Adjusted EBITDA included non-cash stock compensation expense of $0.7 million and $1.4 million for the three and six months ended February 28, 2021, respectively, and $0.3 million and $0.8 million for the corresponding periods.

Corporate and Other

Corporate and Other reported adjusted EBITDA loss of $46.0 million and $72.5 million for the three and six months ended February 28, 2021, respectively, as compared to adjusted EBITDA loss of $28.6 million and $54.8 million in the corresponding periods. The primary reason for the increases in adjusted EBITDA loss year-over-year was the $16.8 million loss on debt extinguishment incurred in the three and six months ended February 28, 2021, with no such costs in the corresponding periods. Adjusted EBITDA included non-cash stock compensation expense of $8.2 million and $13.3 million for the three and six months ended February 28, 2021, respectively, and $4.6 million and $9.4 million for the corresponding periods, respectively.

25

LIQUIDITY AND CAPITAL RESOURCES

Sources of Liquidity and Capital Resources

Our cash flows from operating activities result primarily from the sale of steel, nonferrous metals and related products. We have a diverse and generally stable customer base, and regularly maintain a substantial amount of accounts receivable. We record allowances for the accounts receivable we estimate will not be collected based on market conditions, customers' financial condition, and other factors. Historically, these allowances have not been material. We use credit insurance internationally to mitigate the risk of customer insolvency. We estimate that the amount of credit-insured receivables (and those covered by export letters of credit) was approximately 14% of total trade receivables at February 28, 2021.

From time to time, we use futures or forward contracts to mitigate the risks from fluctuations in commodity prices, foreign currency exchange rates, interest rates and natural gas, electricity and other energy prices. See Note 9, Derivatives, for further information.

The table below reflects our sources, facilities and available liquidity at February 28, 2021. See Note 8, Credit Arrangements, for additional information.

(in thousands)	Total Facility		Availability
Cash and cash equivalents	$	367,347	$	367,347
Notes due from 2023 to 2031	930,000		*
Revolver	350,000		346,958
U.S. accounts receivable facility	200,000		193,291
Poland credit facilities	73,459		72,601
Poland accounts receivable facility	58,767		53,425
Poland Term Loan	66,781		26,712

_________________ 

* We believe we have access to additional financing and refinancing, if needed.

Cash Flows

Operating Activities

Net cash flows from operating activities were $1.2 million for the six months ended February 28, 2021 compared to $253.4 million for the six months ended February 29, 2020. We had a $16.7 million year-over-year decrease in net earnings and a $222.9 million year-over-year increase in cash used by operating assets and liabilities ("working capital"). The increase in cash used by working capital was primarily due to increases in inventory value in the six months ended February 28, 2021 compared to the corresponding period, coupled with an increase in accounts receivable which reflects the higher average selling prices in the six months ended February 28, 2021, compared to a decrease in accounts receivable in the corresponding period. For continuing operations, operating working capital days decreased ten days year-over-year.

Investing Activities

Net cash flows used by investing activities were $67.4 million and $91.5 million for the six months ended February 28, 2021 and February 29, 2020, respectively. The $24.1 million decrease in net cash flows used by investing activities was due to an $8.9 million year-over-year decline in capital expenditures, a $9.9 million year-over-year decline in acquisitions and a $6.3 million year-over-year increase in cash proceeds from the sale of property, plant and equipment and other in the six months ended February 28, 2021 compared to the corresponding period.

We estimate that our 2021 capital spending will range from $200 million to $225 million. We regularly assess our capital spending based on current and expected results and the amount is subject to change.

Financing Activities

Net cash flows used by financing activities were $109.1 million and $122.1 million for the six months ended February 28, 2021 and February 29, 2020, respectively. We had net debt repayments of $61.5 million in the six months ended February 28, 2021, compared to net debt repayments of $91.2 million in the corresponding period. In addition, we paid $13.1 million of debt extinguishment costs related to our early retirement of the 2026 Notes in the six months ended February 28, 2021.

26

COVID-19 has not had a material impact on our operations to date, and our cash and cash equivalents position remains strong at $367.3 million as of February 28, 2021. We anticipate our current cash balances, cash flows from operations and our available sources of liquidity will be sufficient to meet our cash requirements for the next twelve months. However, as the impact of COVID-19 on the economy and our operations evolves, we will continue to assess our liquidity needs. In the event of a sustained market deterioration, we may need additional liquidity, which would require us to evaluate available alternatives and take appropriate actions.

CONTRACTUAL OBLIGATIONS

Our contractual obligations at February 28, 2021 decreased by approximately $20.5 million from August 31, 2020, primarily due to a decrease in long-term debt and interest payable, offset by an increase in purchase obligations. Our estimated contractual obligations for the twelve months ending February 28, 2022 are approximately $512.0 million and primarily consist of expenditures incurred in connection with normal business operations.

Other Commercial Commitments

We maintain stand-by letters of credit to provide support for certain transactions that governmental agencies, our insurance providers and suppliers request. At February 28, 2021, we had committed $23.7 million under these arrangements, of which $3.0 million reduced availability under the Revolver.

OFF-BALANCE SHEET ARRANGEMENTS

We have no off-balance sheet arrangements that may have a current or future material effect on our financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources.

CONTINGENCIES

In the ordinary course of conducting our business, we become involved in litigation, administrative proceedings and governmental investigations, including environmental matters. We may incur settlements, fines, penalties or judgments because of some of these matters. Liabilities and costs associated with litigation-related loss contingencies require estimates and judgments based on our knowledge of the facts and circumstances surrounding each matter and the advice of our legal counsel. We record liabilities for litigation-related losses when a loss is probable and we can reasonably estimate the amount of the loss. We evaluate the measurement of recorded liabilities each reporting period based on the current facts and circumstances specific to each matter. The ultimate losses incurred upon final resolution of litigation-related loss contingencies may differ materially from the estimated liability recorded at a particular balance sheet date. Changes in estimates are recorded in earnings in the period in which such changes occur. We do not believe that any currently pending legal proceedings to which we are a party will have a material adverse effect, individually or in the aggregate, on our results of operations, cash flows or financial condition. See Note 13, Commitments and Contingencies, for more information.

27

FORWARD-LOOKING STATEMENTS

This Form 10-Q contains or incorporates by reference a number of "forward-looking statements" within the meaning of the federal securities laws with respect to general economic conditions, key macro-economic drivers that impact our business, the effects of ongoing trade actions, the effects of continued pressure on the liquidity of our customers, potential synergies and organic growth provided by acquisitions and strategic investments, demand for our products, metal margins, the effect of COVID-19 and related governmental and economic responses thereto, the ability to operate our steel mills at full capacity, future supplies of raw materials and energy for our operations, share repurchases, legal proceedings, the undistributed earnings of our non-U.S. subsidiaries, U.S. non-residential construction activity, international trade, capital expenditures, our liquidity and our ability to satisfy future liquidity requirements, estimated contractual obligations and our expectations or beliefs concerning future events. These forward-looking statements can generally be identified by phrases such as we or our management "expects," "anticipates," "believes," "estimates," "intends," "plans to," "ought," "could," "will," "should," "likely," "appears," "projects," "forecasts," "outlook" or other similar words or phrases. There are inherent risks and uncertainties in any forward-looking statements. We caution readers not to place undue reliance on any forward-looking statements.

Our forward-looking statements are based on management's expectations and beliefs as of the time this Form 10-Q is filed with the SEC or, with respect to any document incorporated by reference, as of the time such document was prepared. Although we believe that our expectations are reasonable, we can give no assurance that these expectations will prove to have been correct, and actual results may vary materially. Except as required by law, we undertake no obligation to update, amend or clarify any forward-looking statements to reflect changed assumptions, the occurrence of anticipated or unanticipated events, new information or circumstances or any other changes. Important factors that could cause actual results to differ materially from our expectations include those described in Part I, Item 1A, Risk Factors, of the 2020 Form 10-K, as well as the following:

•changes in economic conditions which affect demand for our products or construction activity generally, and the impact of such changes on the highly cyclical steel industry;

•rapid and significant changes in the price of metals, potentially impairing our inventory values due to declines in commodity prices or reducing the profitability of our downstream contracts due to rising commodity pricing;

•impacts from COVID-19 on the economy, demand for our products and on our operations, including the responses of governmental authorities to contain COVID-19 and the impact from the distribution of various COVID-19 vaccines;

•excess capacity in our industry, particularly in China, and product availability from competing steel mills and other steel suppliers including import quantities and pricing;

•compliance with and changes in existing and future government laws, regulations and other legal requirements and judicial decisions that govern our business, including increased environmental regulations associated with climate change and greenhouse gas emissions;

•involvement in various environmental matters that may result in fines, penalties or judgments;

•potential limitations in our or our customers' abilities to access credit and non-compliance by our customers with our contracts;

•activity in repurchasing shares of our common stock under our repurchase program;

•financial covenants and restrictions on the operation of our business contained in agreements governing our debt;

•our ability to successfully identify, consummate and integrate acquisitions, and the effects that acquisitions may have on our financial leverage;

•risks associated with acquisitions generally, such as the inability to obtain, or delays in obtaining, required approvals under applicable antitrust legislation and other regulatory and third party consents and approvals;

•operating and start-up risks, as well as market risks associated with the commissioning of new projects could prevent us from realizing anticipated benefits and could result in a loss of all or a substantial part of our investment;

•lower than expected future levels of revenues and higher than expected future costs;

•failure or inability to implement growth strategies in a timely manner;

•impact of goodwill impairment charges;

•impact of long-lived asset impairment charges;

•currency fluctuations;

•global factors, such as trade measures, military conflicts and political uncertainties, including the impact of the 2020 U.S. election on current trade regulations, such as Section 232 trade tariffs, tax legislation and other regulations which might adversely impact our business;

28

•availability and pricing of electricity, electrodes and natural gas for mill operations;

•ability to hire and retain key executives and other employees;

•competition from other materials or from competitors that have a lower cost structure or access to greater financial resources;

•information technology interruptions and breaches in security;

•ability to make necessary capital expenditures;

•availability and pricing of raw materials and other items over which we exert little influence, including scrap metal, energy and insurance;

•unexpected equipment failures;

•losses or limited potential gains due to hedging transactions;

•litigation claims and settlements, court decisions, regulatory rulings and legal compliance risks;

•risk of injury or death to employees, customers or other visitors to our operations; and

•civil unrest, protests and riots.

You should refer to the “Risk Factors” disclosed in our periodic and current reports filed with the SEC for specific risks which would cause actual results to be significantly different from those expressed or implied by these forward-looking statements. It is not possible to identify all of the risks, uncertainties and other factors that may affect future results. In light of these risks and uncertainties, the forward-looking events and circumstances discussed herein may not occur and actual results could differ materially from those anticipated or implied in the forward-looking statements. Accordingly, readers of this Form 10-Q are cautioned not to place undue reliance on the forward-looking statements.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

There were no material changes to the information set forth in Item 7A, Quantitative and Qualitative Disclosures about Market Risk, included in the 2020 Form 10-K.

ITEM 4. CONTROLS AND PROCEDURES

The term "disclosure controls and procedures" is defined in Rules 13a-15(e) and 15d-15(e) of the Exchange Act. This term refers to the controls and other procedures of a company that are designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported within required time periods, and includes controls and procedures designed to ensure that such information is accumulated and communicated to the company's management, including its principal executive and principal financial officers, or persons performing similar functions, as appropriate, to allow timely decisions regarding required disclosure. Our Chief Executive Officer and our Chief Financial Officer have evaluated the effectiveness of our disclosure controls and procedures as of the end of the period covered by this Form 10-Q, and they have concluded that as of that date, our disclosure controls and procedures were effective.

There were no changes in our internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) of the Exchange Act) that occurred during our quarter ended February 28, 2021 that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

29

PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

For information regarding our legal proceedings, refer to “Legal and Environmental Matters” in Note 13 to our condensed consolidated financial statements included in Part I, Item 1, Financial Statements, of this Form 10-Q.

With respect to administrative or judicial proceedings arising under any Federal, State, or local provisions that have been enacted or adopted regulating the discharge of materials into the environment or primarily for the purpose of protecting the environment, we have determined that we will disclose any such proceeding if we reasonably believe such proceeding will result in monetary sanctions, exclusive of interest and costs, of at least $1.0 million. We believe that this threshold is reasonably designed to result in disclosure of environmental proceedings that are material to our business or financial condition. Applying this threshold, there were no environmental matters to disclose for this period.

ITEM 1A. RISK FACTORS

Except as set forth below, there were no material changes to the risk factors previously disclosed in Part I, Item 1A, Risk Factors, of the 2020 Form 10-K and Part II, Item 1A, Risk Factors, of the Quarterly Report on Form 10-Q for the period ended November 30, 2020:

Operating and start-up risks, as well as market risks associated with the commissioning of new projects could prevent us from realizing anticipated benefits and could result in a loss of all or a substantial part of our investment.

Although we have successfully commissioned and operated similar technologies, there are some new technological, as well as operational, market and start-up risks associated with the construction and start-up of our third rolling mill in Poland and third micro mill to be located in Mesa, Arizona. We believe these facilities should be capable of consistently producing high-quality products, and in sufficient quantities and at a cost that will compare favorably with other similar steel manufacturing facilities; however, there can be no assurance that these expectations will be achieved. If we encounter cost overruns, system or process difficulties during or after start-up or quality control restrictions, our capital costs could increase materially, the expected benefits from the development of these facilities could be diminished or lost, and we could lose all or a substantial portion of our investment. We could also encounter commodity market risk if, during a sustained period, the cost to manufacture is greater than projected.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

Purchases of Equity Securities by the Issuer and Affiliated Purchasers

There were no purchases of equity securities registered by the Company pursuant to Section 12 of the Exchange Act during the quarter ended February 28, 2021.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4. MINE SAFETY DISCLOSURES

Not applicable.

ITEM 5. OTHER INFORMATION

Not applicable.

30

ITEM 6. EXHIBITS

3.1(a)	Restated Certificate of Incorporation dated March 2, 1989 (filed as Exhibit 3(i) to Commercial Metals Company's Annual Report on Form 10-K for the fiscal year ended August 31, 2009 and incorporated herein by reference).
3.1(b)	Certificate of Amendment of Restated Certificate of Incorporation dated February 1, 1994 (filed as Exhibit 3(i)(a) to Commercial Metals Company's Annual Report on Form 10-K for the fiscal year ended August 31, 2009 and incorporated herein by reference).
3.1(c)	Certificate of Amendment of Restated Certificate of Incorporation dated February 17, 1995 (filed as Exhibit 3(i)(b) to Commercial Metals Company's Annual Report on Form 10-K for the fiscal year ended August 31, 2009 and incorporated herein by reference).
3.1(d)	Certificate of Amendment of Restated Certificate of Incorporation dated January 30, 2004 (filed as Exhibit 3(i)(d) to Commercial Metals Company's Quarterly Report on Form 10-Q for the quarter ended February 29, 2004 and incorporated herein by reference).
3.1(e)	Certificate of Amendment of Restated Certificate of Incorporation dated January 26, 2006 (filed as Exhibit 3(i) to Commercial Metals Company's Quarterly Report on Form 10-Q for the quarter ended February 28, 2006 and incorporated herein by reference).
3.1(f)	Certificate of Designation, Preferences and Rights of Series A Preferred Stock (filed as Exhibit 2 to Commercial Metals Company's Form 8-A filed August 3, 1999 and incorporated herein by reference).
3.2	Fourth Amended and Restated Bylaws (filed as Exhibit 3.1 to Commercial Metals Company's Current Report on Form 8-K dated September 23, 2019 and incorporated herein by reference).
4.1	Fourth Supplemental Indenture, dated February 2, 2021, by and among Commercial Metals Company and U.S. Bank National Association, as trustee (filed as Exhibit 4.1 to Commercial Metals Company's Current Report on Form 8-K dated February 2, 2021 and incorporated herein by reference).
4.2	Form of 3.875% Senior Note due 2031 (filed as Exhibit 4.2 to Commercial Metals Company's Current Report on Form 8-K dated February 2, 2021 and incorporated herein by reference).
31.1	Certification of Barbara R. Smith, President and Chief Executive Officer of Commercial Metals Company, pursuant to Section 302 to the Sarbanes-Oxley Act of 2002 (filed herewith).
31.2	Certification of Paul J. Lawrence, Vice President and Chief Financial Officer of Commercial Metals Company, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (filed herewith).
32.1	Certification of Barbara R. Smith, President and Chief Executive Officer of Commercial Metals Company, pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (furnished herewith).
32.2	Certification of Paul J. Lawrence, Vice President and Chief Financial Officer of Commercial Metals Company, pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (filed herewith).
101.INS	Inline XBRL Instance Document (filed herewith).
101.SCH	Inline XBRL Taxonomy Extension Schema Document (filed herewith).
101.CAL	Inline XBRL Taxonomy Extension Calculation Linkbase Document (filed herewith).
101.DEF	Inline XBRL Taxonomy Extension Definition Linkbase Document (filed herewith).
101.LAB	Inline XBRL Taxonomy Extension Label Linkbase Document (filed herewith).
101.PRE	Inline XBRL Taxonomy Extension Presentation Linkbase Document (filed herewith).
104	Cover Page Interactive Data File

31

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	COMMERCIAL METALS COMPANY
March 24, 2021	/s/ Paul J. Lawrence
	Paul J. Lawrence
	Vice President and Chief Financial Officer
	(Duly authorized officer and principal financial officer of the registrant)

32

EX-31.1

EXHIBIT 31.1

CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER

I, Barbara R. Smith, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Commercial Metals Company;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: March 24, 2021

/s/ Barbara R. Smith

Barbara R. Smith

President and Chief Executive Officer

EX-31.2

EXHIBIT 31.2

CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER

I, Paul J. Lawrence, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Commercial Metals Company;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: March 24, 2021

/s/ Paul J. Lawrence

Paul J. Lawrence

Vice President and Chief Financial Officer

EX-32.1

EXHIBIT 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Commercial Metals Company (the “Company”) on Form 10-Q for the period ended February 28, 2021 (the “Report”), I, Barbara R. Smith, President and Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to my knowledge:

(1) the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

(2) the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/ Barbara R. Smith

Barbara R. Smith

President and Chief Executive Officer

Date: March 24, 2021

EX-32.2

EXHIBIT 32.2

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Commercial Metals Company (the “Company”) on Form 10-Q for the period ended February 28, 2021 (the “Report”), I, Paul J. Lawrence, Vice President and Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to my knowledge:

(1) the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

(2) the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/ Paul J. Lawrence

Paul J. Lawrence

Vice President and Chief Financial Officer

Date: March 24, 2021

XML

Cover Page - shares	6 Months Ended
	Feb. 28, 2021	Mar. 23, 2021
Cover [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Feb. 28, 2021
Document Transition Report	false
Entity File Number	1-4304
Entity Registrant Name	COMMERCIAL METALS COMPANY
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	75-0725338
Entity Address, Address Line One	6565 N. MacArthur Blvd.
Entity Address, City or Town	Irving
Entity Address, State or Province	TX
Entity Address, Postal Zip Code	75039
City Area Code	(214)
Local Phone Number	689-4300
Title of 12(b) Security	Common Stock, $0.01 par value
Trading Symbol	CMC
Security Exchange Name	NYSE
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		120,510,370
Entity Central Index Key	0000022444
Amendment Flag	false
Document Fiscal Year Focus	2021
Document Fiscal Period Focus	FY
Current Fiscal Year End Date	--08-31

XML

CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS (UNAUDITED) - USD ($) $ in Thousands		3 Months Ended		6 Months Ended
		Feb. 28, 2021	Feb. 29, 2020	Feb. 28, 2021	Feb. 29, 2020
Income Statement [Abstract]
Net sales		$ 1,462,270	$ 1,340,963	$ 2,854,073	$ 2,725,671
Costs and expenses:
Cost of goods sold		1,228,343	1,123,096	2,403,162	2,269,610
Selling, general and administrative expenses		115,417	115,538	229,044	226,537
Loss on debt extinguishment		16,841	0	16,841	0
Interest expense		14,021	15,888	28,280	32,466
Asset impairments		474	0	4,068	530
Total costs and expenses		1,375,096	1,254,522	2,681,395	2,529,143
Earnings from continuing operations before income taxes		87,174	86,441	172,678	196,528
Income taxes		20,941	22,845	42,534	50,177
Earnings from continuing operations		66,233	63,596	130,144	146,351
Earnings from discontinued operations before income taxes		197	301	447	1,196
Income taxes		73	99	141	401
Earnings from discontinued operations		124	202	306	795
Net earnings		$ 66,357	$ 63,798	$ 130,450	$ 147,146
Basic earnings per share:
Earnings from continuing operations (in USD per share)	[1]	$ 0.55	$ 0.53	$ 1.08	$ 1.23
Earnings (loss) from discontinued operations (in USD per share)	[1]	0	0	0	0.01
Net earnings (in USD per share)	[1]	0.55	0.54	1.09	1.24
Diluted earnings per share:
Earnings from continuing operations (in USD per share)	[1]	0.54	0.53	1.07	1.22
Earnings (loss) from discontinued operations (in USD per share)	[1]	0	0	0	0.01
Net earnings (in USD per share)	[1]	$ 0.55	$ 0.53	$ 1.07	$ 1.22
Average basic shares outstanding (shares)		120,345,432	118,919,455	120,052,459	118,644,823
Average diluted shares outstanding (shares)		121,751,859	120,407,256	121,672,194	120,303,259

[1] *Earnings Per Share ("EPS") is calculated independently for each component and may not sum to Net EPS due to rounding.

XML

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (UNAUDITED) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Feb. 28, 2021	Feb. 29, 2020	Feb. 28, 2021	Feb. 29, 2020
Statement of Comprehensive Income [Abstract]
Net earnings	$ 66,357	$ 63,798	$ 130,450	$ 147,146
Other comprehensive income (loss), net of income taxes:
Foreign currency translation adjustment	1,465	(1,068)	(6,923)	5,856
Net unrealized gain (loss) on derivatives:
Unrealized holding gain (loss)	7,723	(3,646)	8,887	(2,932)
Reclassification for gain included in net earnings	(259)	(83)	(313)	(172)
Net unrealized gain (loss) on derivatives	7,464	(3,729)	8,574	(3,104)
Defined benefit obligation:
Amortization of prior services	(14)	(8)	(27)	(16)
Defined benefit obligation	(14)	(8)	(27)	(16)
Other comprehensive income (loss)	8,915	(4,805)	1,624	2,736
Comprehensive income	$ 75,272	$ 58,993	$ 132,074	$ 149,882

XML

CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) - USD ($) $ in Thousands	Feb. 28, 2021	Aug. 31, 2020
Current assets:
Cash and cash equivalents	$ 367,347	$ 542,103
Accounts receivable (less allowance for doubtful accounts of $7,623 and $9,597)	895,604	880,728
Inventories, net	776,561	625,393
Prepaid and other current assets	166,124	165,879
Total current assets	2,205,636	2,214,103
Property, plant and equipment, net	1,557,143	1,571,067
Goodwill	66,235	64,321
Other noncurrent assets	235,027	232,237
Total assets	4,064,041	4,081,728
Current liabilities:
Accounts payable	309,413	266,102
Accrued expenses and other payables	341,903	461,012
Current maturities of long-term debt and short-term borrowings	22,777	18,149
Total current liabilities	674,093	745,263
Deferred income taxes	126,789	130,810
Other noncurrent liabilities	242,632	250,706
Long-term debt	1,011,035	1,065,536
Total liabilities	2,054,549	2,192,315
Commitments and contingencies (Note 13)
Stockholders' equity:
Common stock, par value $0.01 per share; authorized 200,000,000 shares; issued 129,060,664 shares; outstanding 120,508,215 and 119,220,905 shares	1,290	1,290
Additional paid-in capital	354,620	358,912
Accumulated other comprehensive loss	(102,140)	(103,764)
Retained earnings	1,909,443	1,807,826
Less treasury stock 8,552,449 and 9,839,759 shares at cost	(153,952)	(175,063)
Stockholders' equity	2,009,261	1,889,201
Stockholders' equity attributable to noncontrolling interests	231	212
Total equity	2,009,492	1,889,413
Total liabilities and stockholders' equity	$ 4,064,041	$ 4,081,728

XML

CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) (Parenthetical) - USD ($) $ in Thousands	Feb. 28, 2021	Aug. 31, 2020
Statement of Financial Position [Abstract]
Allowance for doubtful accounts	$ 7,623	$ 9,597
Common stock, par value (in USD per share)	$ 0.01	$ 0.01
Common stock, shares authorized	200,000,000	200,000,000
Common stock, shares issued	129,060,664	129,060,664
Common stock, shares outstanding	120,508,215	119,220,905
Treasury stock, shares	8,552,449	9,839,759

XML

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) - USD ($) $ in Thousands	6 Months Ended
	Feb. 28, 2021	Feb. 29, 2020
Cash flows from (used by) operating activities:
Net earnings	$ 130,450	$ 147,146
Adjustments to reconcile net earnings to cash flows from (used by) operating activities:
Depreciation and amortization	83,372	82,338
Stock-based compensation	21,758	15,805
Loss on debt extinguishment	16,841	0
Deferred income taxes and other long-term taxes	(8,129)	42,142
Net gain on disposals of subsidiaries, assets and other	(5,481)	(5,585)
Asset impairments	4,068	530
Amortization of acquired unfavorable contract backlog	(3,032)	(14,328)
Other	(105)	1,041
Changes in operating assets and liabilities	(238,539)	(15,673)
Net cash flows from operating activities	1,203	253,416
Cash flows from (used by) investing activities:
Capital expenditures	(87,688)	(96,592)
Proceeds from the sale of property, plant and equipment and other	20,338	14,004
Acquisitions, net of cash acquired	0	(9,850)
Proceeds from insurance	0	974
Net cash flows used by investing activities:	(67,350)	(91,464)
Cash flows from (used by) financing activities:
Proceeds from issuance of long-term debt, net	296,250	11,299
Repayments of long-term debt	(357,792)	(106,880)
Debt extinguishment costs	(13,051)	0
Debt issuance costs	(1,124)	0
Proceeds from accounts receivable programs	8,848	85,686
Repayments under accounts receivable programs	(8,848)	(81,314)
Dividends	(28,833)	(28,480)
Stock issued under incentive and purchase plans, net of forfeitures	(4,536)	(2,463)
Contribution from noncontrolling interest	19	16
Net cash flows used by financing activities	(109,067)	(122,136)
Effect of exchange rate changes on cash	(419)	337
Increase (decrease) in cash, restricted cash and cash equivalents	(175,633)	40,153
Cash, restricted cash and cash equivalents at beginning of period	369,331	233,882
Cash, restricted cash and cash equivalents at end of period	369,331	233,882
Supplemental information:
Cash paid for income taxes	48,757	27,759
Cash paid for interest	34,094	29,484
Noncash activities:
Liabilities related to additions of property, plant and equipment	$ 16,252	$ 29,176

XML

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) (Parenthetical) - USD ($) $ in Thousands	Feb. 28, 2021	Feb. 29, 2020
Statement of Cash Flows [Abstract]
Cash and cash equivalents	$ 367,347	$ 232,442
Restricted Cash	1,984	1,440
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents, Total	$ 369,331	$ 233,882

XML

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (UNAUDITED) - USD ($) $ in Thousands	Total	Common Stock	Additional Paid-In Capital	Accumulated Other Comprehensive Loss	Retained Earnings	Treasury Stock	Noncontrolling Interests
Beginning balance at Aug. 31, 2019	$ 1,624,057	$ 1,290	$ 358,668	$ (124,126)	$ 1,585,379	$ (197,350)	$ 196
Beginning balance, shares at Aug. 31, 2019		129,060,664
Beginning balance, treasury stock, shares at Aug. 31, 2019						(11,135,726)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net earnings	147,146				147,146
Other comprehensive income (loss)	2,736
Dividends	(28,480)
Shares Issued, Value, Share-based Payment Arrangement, after Forfeiture	(2,463)		(22,230)			$ 19,767
Issuance of stock under incentive and purchase plans, net of forfeitures, shares						1,136,951
Stock-based compensation	12,533		12,533
Contribution from noncontrolling interest	16						16
Reclassification of share-based liability awards	2,510		2,510
Ending balance at Feb. 29, 2020	1,758,055	$ 1,290	351,481	(121,390)	1,704,045	$ (177,583)	212
Ending balance, shares at Feb. 29, 2020		129,060,664
Ending balance, treasury stock, shares at Feb. 29, 2020						(9,998,775)
Beginning balance at Nov. 30, 2019	1,701,697	$ 1,290	347,192	(116,585)	1,654,489	$ (184,885)	196
Beginning balance, shares at Nov. 30, 2019		129,060,664
Beginning balance, treasury stock, shares at Nov. 30, 2019						(10,410,799)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net earnings	63,798
Other comprehensive income (loss)	(4,805)
Dividends	(14,242)				(14,242)
Shares Issued, Value, Share-based Payment Arrangement, after Forfeiture	5,354		(1,948)			$ 7,302
Issuance of stock under incentive and purchase plans, net of forfeitures, shares						412,024
Stock-based compensation	6,237		6,237
Contribution from noncontrolling interest	16						16
Ending balance at Feb. 29, 2020	1,758,055	$ 1,290	351,481	(121,390)	1,704,045	$ (177,583)	212
Ending balance, shares at Feb. 29, 2020		129,060,664
Ending balance, treasury stock, shares at Feb. 29, 2020						(9,998,775)
Beginning balance at Aug. 31, 2020	$ 1,889,413	$ 1,290	358,912	(103,764)	1,807,826	$ (175,063)	212
Beginning balance, shares at Aug. 31, 2020	129,060,664	129,060,664
Beginning balance, treasury stock, shares at Aug. 31, 2020	(9,839,759)					(9,839,759)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net earnings	$ 130,450				130,450
Other comprehensive income (loss)	1,624
Dividends	(28,833)
Shares Issued, Value, Share-based Payment Arrangement, after Forfeiture	(4,536)		(25,647)			$ 21,111
Issuance of stock under incentive and purchase plans, net of forfeitures, shares						1,287,310
Stock-based compensation	15,935		15,935
Contribution from noncontrolling interest	19						19
Reclassification of share-based liability awards	5,420		5,420
Ending balance at Feb. 28, 2021	$ 2,009,492	$ 1,290	354,620	(102,140)	1,909,443	$ (153,952)	231
Ending balance, shares at Feb. 28, 2021	129,060,664	129,060,664
Ending balance, treasury stock, shares at Feb. 28, 2021	(8,552,449)					(8,552,449)
Beginning balance at Nov. 30, 2020	$ 1,934,899	$ 1,290	348,816	(111,055)	1,857,513	$ (161,877)	212
Beginning balance, shares at Nov. 30, 2020		129,060,664
Beginning balance, treasury stock, shares at Nov. 30, 2020						(8,992,643)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net earnings	66,357
Other comprehensive income (loss)	8,915
Dividends	(14,427)				(14,427)
Shares Issued, Value, Share-based Payment Arrangement, after Forfeiture	5,805		(2,120)			$ 7,925
Issuance of stock under incentive and purchase plans, net of forfeitures, shares						440,194
Stock-based compensation	7,924		7,924
Contribution from noncontrolling interest	19						19
Ending balance at Feb. 28, 2021	$ 2,009,492	$ 1,290	$ 354,620	$ (102,140)	$ 1,909,443	$ (153,952)	$ 231
Ending balance, shares at Feb. 28, 2021	129,060,664	129,060,664
Ending balance, treasury stock, shares at Feb. 28, 2021	(8,552,449)					(8,552,449)

XML

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (UNAUDITED) (Parenthetical) - $ / shares	3 Months Ended		6 Months Ended
	Feb. 28, 2021	Feb. 29, 2020	Feb. 28, 2021	Feb. 29, 2020
Statement of Stockholders' Equity [Abstract]
Cash dividends per share (in USD per share)	$ 0.12	$ 0.12	$ 0.24	$ 0.24

XML

ACCOUNTING POLICIES

6 Months Ended

Feb. 28, 2021

Accounting Policies [Abstract]

Accounting policies

Basis of Presentation

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States ("GAAP") on a basis consistent with that used in the Annual Report on Form 10-K for the year ended August 31, 2020 ("2020 Form 10-K") filed by Commercial Metals Company ("CMC," and together with its consolidated subsidiaries, the "Company") with the Securities and Exchange Commission (the "SEC") and include all normal recurring adjustments necessary to present fairly the condensed consolidated balance sheets and the condensed consolidated statements of earnings, comprehensive income, cash flows and stockholders' equity for the periods indicated. These notes should be read in conjunction with the consolidated financial statements included in the 2020 Form 10-K. The results of operations for the three and six month periods are not necessarily indicative of the results to be expected for the full fiscal year. Any reference in this Form 10-Q to the "corresponding period" relates to the relevant three or six month period ended February 29, 2020.

Any reference in this Form 10-Q to a year refers to the fiscal year ended August 31st of that year, unless otherwise noted.

XML

CHANGES IN BUSINESS

6 Months Ended

Feb. 28, 2021

Business Combinations [Abstract]

Changes in Business

Facility Closures and Dispositions

In October 2019, the Company closed the melting operations at its Rancho Cucamonga facility, which is part of the North America segment. In August 2020, the Company announced plans to sell the Rancho Cucamonga site and the Company ceased operations at this facility in January 2021. As a result, the Company recorded $5.4 million and $13.4 million of expense in the three and six months ended February 28, 2021, respectively, and $6.3 million of expense in the six months ended February 29, 2020, all of which was recorded in the first quarter of 2020, related to asset impairments, severance, pension curtailment, environmental obligations and vendor agreement terminations. The disposition does not meet the criteria for discontinued operations, and as of February 28, 2021, does not qualify for held for sale accounting.

XML

ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)

6 Months Ended

Feb. 28, 2021

Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract]

Accumulated other comprehensive income (loss)

The following tables reflect the changes in accumulated other comprehensive income (loss) ("AOCI"):

	Three Months Ended February 28, 2021
(in thousands)	Foreign Currency Translation		Unrealized Gain (Loss) on Derivatives		Defined Benefit Obligation		Total AOCI
Balance, December 1, 2020	$	(96,321)	$	(10,224)	$	(4,510)	$	(111,055)
Other comprehensive income (loss) before reclassifications	1,465		9,535		(14)		10,986
Amounts reclassified from AOCI	—		(320)		—		(320)
Income taxes	—		(1,751)		—		(1,751)
Net other comprehensive income (loss)	1,465		7,464		(14)		8,915
Balance, February 28, 2021	$	(94,856)	$	(2,760)	$	(4,524)	$	(102,140)
	Six Months Ended February 28, 2021
(in thousands)	Foreign Currency Translation		Unrealized Gain (Loss) on Derivatives		Defined Benefit Obligation		Total AOCI
Balance, September 1, 2020	$	(87,933)	$	(11,334)	$	(4,497)	$	(103,764)
Other comprehensive income (loss) before reclassifications	(6,923)		10,972		(34)		4,015
Amounts reclassified from AOCI	—		(387)		—		(387)
Income taxes	—		(2,011)		7		(2,004)
Net other comprehensive income (loss)	(6,923)		8,574		(27)		1,624
Balance, February 28, 2021	$	(94,856)	$	(2,760)	$	(4,524)	$	(102,140)

	Three Months Ended February 29, 2020
(in thousands)	Foreign Currency Translation		Unrealized Gain (Loss) on Derivatives		Defined Benefit Obligation		Total AOCI
Balance, December 1, 2019	$	(114,574)	$	1,731	$	(3,742)	$	(116,585)
Other comprehensive loss before reclassifications	(1,066)		(4,501)		(14)		(5,581)
Amounts reclassified from AOCI	(2)		(104)		—		(106)
Income taxes	—		876		6		882
Net other comprehensive loss	(1,068)		(3,729)		(8)		(4,805)
Balance, February 29, 2020	$	(115,642)	$	(1,998)	$	(3,750)	$	(121,390)
	Six Months Ended February 29, 2020
(in thousands)	Foreign Currency Translation		Unrealized Gain (Loss) on Derivatives		Defined Benefit Obligation		Total AOCI
Balance, September 1, 2019	$	(121,498)	$	1,106	$	(3,734)	$	(124,126)
Other comprehensive income (loss) before reclassifications	5,858		(3,619)		(24)		2,215
Amounts reclassified from AOCI	(2)		(214)		—		(216)
Income taxes	—		729		8		737
Net other comprehensive income (loss)	5,856		(3,104)		(16)		2,736
Balance, February 29, 2020	$	(115,642)	$	(1,998)	$	(3,750)	$	(121,390)

Items reclassified out of AOCI were immaterial for the three and six months ended February 28, 2021 and February 29, 2020. Thus, the corresponding line items in the condensed consolidated statements of earnings to which the items were reclassified are not presented.

XML

REVENUE RECOGNITION

6 Months Ended

Feb. 28, 2021

Revenue from Contract with Customer [Abstract]

Revenue Recognition

NOTE 4. REVENUE RECOGNITION

Each fabricated product contract sold by the North America segment represents a single performance obligation. Revenue from contracts where the Company provides fabricated product and installation services is recognized over time using an input measure, and these contracts represented 11% and 12% of net sales in the North America segment in the three and six months ended February 28, 2021, respectively. Revenue from contracts where the Company does not provide installation services is recognized over time using an output measure, and these contracts represented 9% of net sales in the North America segment in both the three and six months ended February 28, 2021. The remaining 80% and 79% of net sales in the North America segment were recognized at a point in time concurrent with the transfer of control, or as amounts were billed to the customer under an available practical expedient, in the three and six months ended February 28, 2021, respectively.

The following table provides information about assets and liabilities from contracts with customers.

(in thousands)	February 28, 2021		August 31, 2020
Contract assets (included in accounts receivable)	$	54,468	$	53,275
Contract liabilities (included in accrued expenses and other payables)	18,638		25,450

During the six months ended February 28, 2021, approximately $21.3 million was recognized in the condensed consolidated statements of earnings related to August 31, 2020 contract liabilities.

Remaining Performance Obligations

Remaining performance obligations represent the transaction price of fabricated product contracts where revenue is recognized using an input or output measure for which work has not yet been performed. As of February 28, 2021, $688.3 million was allocated to remaining performance obligations in the North America segment related to those contracts.

XML

INVENTORIES, NET

6 Months Ended

Feb. 28, 2021

Inventory Disclosure [Abstract]

Inventories, net

NOTE 5. INVENTORIES, NET

The majority of the Company's inventories are in the form of semi-finished and finished goods. Under the Company’s business model, products are sold to external customers in various stages, from semi-finished billets through fabricated steel, leading these categories to be combined. As such, at February 28, 2021 and August 31, 2020, work in process inventories were immaterial. At February 28, 2021 and August 31, 2020, the Company's raw materials inventories were $213.3 million and $123.9 million, respectively.

XML

GOODWILL AND OTHER INTANGIBLES

6 Months Ended

Feb. 28, 2021

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and other intangibles

Goodwill by reportable segment at February 28, 2021 is detailed in the following table:

(in thousands)	North America		Europe		Consolidated
Goodwill, gross*	$	71,941	$	4,491	$	76,432
Accumulated impairment losses*	(10,036)		(161)		(10,197)
Goodwill, net*	$	61,905	$	4,330	$	66,235

_________________ 

* The change in balance from August 31, 2020 was immaterial.

The total gross carrying amounts of the Company's intangible assets subject to amortization were $21.8 million and $22.1 million, and the total net carrying amounts were $11.4 million and $12.6 million at February 28, 2021 and August 31, 2020, respectively. These assets were included in other noncurrent assets on the Company's condensed consolidated balance sheets. Intangible amortization expense from continuing operations related to such intangible assets was immaterial for the three and six months ended February 28, 2021 and February 29, 2020. Excluding goodwill, the Company did not have any significant intangible assets with indefinite lives at February 28, 2021.

At February 28, 2021 and August 31, 2020, the net carrying amount of the acquired unfavorable contract backlog liability was $3.0 million and $6.0 million, respectively. Amortization of the acquired unfavorable contract backlog was $1.5 million and $3.0 million for the three and six months ended February 28, 2021, respectively, and $6.0 million and $14.3 million for the

corresponding periods, and was recorded as an increase to net sales in the Company’s condensed consolidated statements of earnings.

XML

LEASES

6 Months Ended

Feb. 28, 2021

Leases [Abstract]

Operating Leases

The following table presents the components of the total leased assets and lease liabilities and their classification in the Company's condensed consolidated balance sheets:

(in thousands)	Classification in Condensed Consolidated Balance Sheets	February 28, 2021		August 31, 2020
Assets:
Operating assets	Other noncurrent assets	$	117,547	$	114,905
Finance assets	Property, plant and equipment, net	52,325		50,642
Total leased assets		$	169,872	$	165,547
Liabilities:
Operating lease liabilities:
Current	Accrued expenses and other payables	$	27,176	$	27,604
Long-term	Other noncurrent liabilities	98,807		95,810
Total operating lease liabilities		125,983		123,414
Finance lease liabilities:
Current	Current maturities of long-term debt and short-term borrowings	15,228		14,373
Long-term	Long-term debt	35,992		35,851
Total finance lease liabilities		51,220		50,224
Total lease liabilities		$	177,203	$	173,638

The components of lease cost were as follows:

	Three Months Ended				Six Months Ended
(in thousands)	February 28, 2021		February 29, 2020		February 28, 2021		February 29, 2020
Operating lease expense	$	8,651	$	8,815	$	17,373	$	17,605
Finance lease expense:
Amortization of assets	3,219		2,720		6,458		4,885
Interest on lease liabilities	563		465		1,118		866
Total finance lease expense	3,782		3,185		7,576		5,751
Variable and short-term lease expense	4,324		4,381		9,286		8,314
Total lease expense	$	16,757	$	16,381	$	34,235	$	31,670

The weighted average remaining lease term and discount rate for operating and finance leases are presented in the following table:

	February 28, 2021		August 31, 2020
Weighted average remaining lease term (years)
Operating leases	6.4		6.3
Finance leases	3.6		3.8
Weighted average discount rate
Operating leases	4.482	%	4.283	%
Finance leases	4.296	%	4.270	%

Cash flow and other information related to leases is included in the following table:

	Six Months Ended
(in thousands)	February 28, 2021		February 29, 2020
Cash paid for amounts included in the measurement of lease liabilities
Operating cash outflows from operating leases	$	17,812	$	17,594
Operating cash outflows from finance leases	1,125		787
Financing cash outflows from finance leases	7,761		6,426
Right of use ("ROU") assets obtained in exchange for lease obligations:
Operating leases	20,249		28,942
Finance leases	8,784		13,040

Maturities of lease liabilities at February 28, 2021 are presented in the following table:

(in thousands)	Operating Leases		Finance Leases
Year 1	$	32,387	$	17,138
Year 2	26,877		14,767
Year 3	22,162		12,336
Year 4	17,182		8,716
Year 5	12,921		2,392
Thereafter	35,374		97
Total lease payments	146,903		55,446
Less: Imputed interest	20,920		4,226
Present value of lease liabilities	$	125,983	$	51,220

Finance Leases

The following table presents the components of the total leased assets and lease liabilities and their classification in the Company's condensed consolidated balance sheets:

(in thousands)	Classification in Condensed Consolidated Balance Sheets	February 28, 2021		August 31, 2020
Assets:
Operating assets	Other noncurrent assets	$	117,547	$	114,905
Finance assets	Property, plant and equipment, net	52,325		50,642
Total leased assets		$	169,872	$	165,547
Liabilities:
Operating lease liabilities:
Current	Accrued expenses and other payables	$	27,176	$	27,604
Long-term	Other noncurrent liabilities	98,807		95,810
Total operating lease liabilities		125,983		123,414
Finance lease liabilities:
Current	Current maturities of long-term debt and short-term borrowings	15,228		14,373
Long-term	Long-term debt	35,992		35,851
Total finance lease liabilities		51,220		50,224
Total lease liabilities		$	177,203	$	173,638

The components of lease cost were as follows:

	Three Months Ended				Six Months Ended
(in thousands)	February 28, 2021		February 29, 2020		February 28, 2021		February 29, 2020
Operating lease expense	$	8,651	$	8,815	$	17,373	$	17,605
Finance lease expense:
Amortization of assets	3,219		2,720		6,458		4,885
Interest on lease liabilities	563		465		1,118		866
Total finance lease expense	3,782		3,185		7,576		5,751
Variable and short-term lease expense	4,324		4,381		9,286		8,314
Total lease expense	$	16,757	$	16,381	$	34,235	$	31,670

The weighted average remaining lease term and discount rate for operating and finance leases are presented in the following table:

	February 28, 2021		August 31, 2020
Weighted average remaining lease term (years)
Operating leases	6.4		6.3
Finance leases	3.6		3.8
Weighted average discount rate
Operating leases	4.482	%	4.283	%
Finance leases	4.296	%	4.270	%

Cash flow and other information related to leases is included in the following table:

	Six Months Ended
(in thousands)	February 28, 2021		February 29, 2020
Cash paid for amounts included in the measurement of lease liabilities
Operating cash outflows from operating leases	$	17,812	$	17,594
Operating cash outflows from finance leases	1,125		787
Financing cash outflows from finance leases	7,761		6,426
Right of use ("ROU") assets obtained in exchange for lease obligations:
Operating leases	20,249		28,942
Finance leases	8,784		13,040

Maturities of lease liabilities at February 28, 2021 are presented in the following table:

(in thousands)	Operating Leases		Finance Leases
Year 1	$	32,387	$	17,138
Year 2	26,877		14,767
Year 3	22,162		12,336
Year 4	17,182		8,716
Year 5	12,921		2,392
Thereafter	35,374		97
Total lease payments	146,903		55,446
Less: Imputed interest	20,920		4,226
Present value of lease liabilities	$	125,983	$	51,220

XML

CREDIT ARRANGEMENTS

6 Months Ended

Feb. 28, 2021

Debt Disclosure [Abstract]

Credit arrangements

Long-term debt was as follows: 

(in thousands)	Weighted Average Interest Rate as of February 28, 2021	February 28, 2021		August 31, 2020
2031 Notes	3.875%	$	300,000	$	—
2027 Notes	5.375%	300,000		300,000
2026 Notes	5.750%	—		350,000
2023 Notes	4.875%	330,000		330,000
Poland Term Loan	1.710%	40,068		40,713
Other	5.100%	21,329		21,329
Finance leases		51,220		50,224
Total debt		1,042,617		1,092,266
Less debt issuance costs		8,805		8,581
Total amounts outstanding		1,033,812		1,083,685
Less current maturities of long-term debt		22,777		18,149
Long-term debt		$	1,011,035	$	1,065,536

In February 2021, the Company issued $300.0 million of 3.875% Senior Notes due February 2031 (the "2031 Notes"). Issuance costs associated with the 2031 Notes were approximately $4.9 million. Interest on the 2031 Notes is payable semiannually.

In May 2018, the Company issued $350.0 million of 5.750% Senior Notes due April 2026 (the "2026 Notes"). In February 2021, the Company accepted for purchase approximately $77.8 million of the outstanding principal amount of the 2026 Notes

through a cash tender offer. Following the expiration of the cash tender offer on February 18, 2021, the Company redeemed the remaining outstanding principal amount of the 2026 Notes. In the three and six month periods ended February 28, 2021, the Company recognized a $16.8 million loss on debt extinguishment related to the retirement of the 2026 Notes.

The Company had no amounts drawn under its $350.0 million revolving credit facility (the "Revolver") at February 28, 2021 and August 31, 2020. The availability under the Revolver was reduced by outstanding stand-by letters of credit totaling $3.0 million at February 28, 2021 and August 31, 2020.

The Company has a Term Loan facility (the "Poland Term Loan") through its subsidiary, CMC Poland Sp. z.o.o. ("CMCP"), which allows for a maximum aggregate principal amount of Polish zloty ("PLN") 250.0 million, or $66.8 million, at February 28, 2021. At February 28, 2021 and August 31, 2020, PLN 150.0 million, or $40.1 million, and PLN 150.0 million, or $40.7 million, respectively, was outstanding.

The Company also has credit facilities in Poland through its subsidiary CMCP. At February 28, 2021, CMCP's credit facilities totaled PLN 275.0 million, or $73.5 million. These facilities expire in March 2022. No amounts were outstanding under these facilities as of February 28, 2021 or August 31, 2020. The available balance of these credit facilities was reduced by outstanding stand-by letters of credit, guarantees, and/or other financial assurance instruments, which totaled $0.9 million and $0.8 million at February 28, 2021 and August 31, 2020, respectively.

The Company's debt agreements require compliance with certain non-financial and financial covenants, including an interest coverage ratio and a debt to capitalization ratio. At February 28, 2021, the Company was in compliance with all covenants contained in its debt agreements.

Accounts Receivable Facilities

The Company had no advance payments outstanding under its U.S. accounts receivable facility at February 28, 2021 or August 31, 2020.

The Poland accounts receivable facility has a limit of PLN 220.0 million, or $58.8 million at February 28, 2021. The Company had no advance payments outstanding under the Poland accounts receivable facility at February 28, 2021 or August 31, 2020.

XML

DERIVATIVES

6 Months Ended

Feb. 28, 2021

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivatives

The Company's global operations and product lines expose it to risks from fluctuations in metal commodity prices, foreign currency exchange rates, interest rates and natural gas, electricity and other energy prices. One objective of the Company's risk management program is to mitigate these risks using derivative instruments. The Company enters into (i) metal commodity futures and forward contracts to mitigate the risk of unanticipated changes in gross margin due to price volatility in these commodities, (ii) foreign currency forward contracts that match the expected settlements for purchases and sales denominated in foreign currencies and (iii) energy derivatives to mitigate the risk related to price volatility of electricity and natural gas.

At February 28, 2021, the notional values of the Company's foreign currency and commodity commitments were $165.8 million and $217.2 million, respectively. At August 31, 2020, the notional values of the Company's foreign currency and commodity contract commitments were $138.5 million and $195.8 million, respectively.

The following table provides information regarding the Company's commodity contract commitments at February 28, 2021:

Commodity	Long/Short	Total
Aluminum	Long	3,350	MT
Aluminum	Short	1,675	MT
Copper	Long	1,077	MT
Copper	Short	7,836	MT
Electricity	Long	1,967,000	MW(h)

_________________ 

MT = Metric Ton

MW(h) = Megawatt hour

The Company designates only those contracts which closely match the terms of the underlying transaction as hedges for accounting purposes. Certain foreign currency and commodity contracts were not designated as hedges for accounting

purposes, although management believes they are essential economic hedges.Commodity derivatives not designated as hedging instruments resulted in a loss, before income taxes, of $11.0 million and $16.6 million, in the three and six months ended February 28, 2021, respectively, and a gain, before income taxes, of $1.7 million and $0.4 million in the three and six months ended February 29, 2020, respectively, primarily recorded in cost of goods sold within the condensed consolidated statements of earnings. Foreign exchange derivatives accounted for as cash flow hedging instruments resulted in a net gain of $7.7 million and $8.9 million, in the three and six months ended February 28, 2021, respectively, and a net loss of $3.6 million and $2.9 million in the three and six months ended February 29, 2020, respectively, recognized in the condensed consolidated statements of comprehensive income (loss). See Note 10, Fair Value, for the fair value of the Company's derivative instruments recorded in the condensed consolidated balance sheets.

XML

FAIR VALUE

6 Months Ended

Feb. 28, 2021

Fair Value Disclosures [Abstract]

Fair value

The Company has established a fair value hierarchy which prioritizes the inputs to the valuation techniques used to measure fair value into three levels. These levels are determined based on the lowest level input that is significant to the fair value measurement. Levels within the hierarchy are defined within the Summary of Significant Accounting Policies footnote in our 2020 Form 10-K.

The following tables summarize information regarding the Company's financial assets and financial liabilities that were measured at fair value on a recurring basis:

			Fair Value Measurements at Reporting Date Using
(in thousands)	February 28, 2021		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant  Other Observable Inputs (Level 2)		Significant Unobservable  Inputs (Level 3)
Assets:
Investment deposit accounts (1)	$	345,240	$	345,240	$	—	$	—
Commodity derivative assets (2)	1,091		1,091		—		—
Foreign exchange derivative assets (2)	1,301		—		1,301		—
Liabilities:
Commodity derivative liabilities (2)	11,349		7,064		—		4,285
Foreign exchange derivative liabilities (2)	635		—		635		—

			Fair Value Measurements at Reporting Date Using
(in thousands)	August 31, 2020		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant  Other Observable Inputs (Level 2)		Significant Unobservable  Inputs (Level 3)
Assets:
Investment deposit accounts (1)	$	449,824	$	449,824	$	—	$	—
Commodity derivative assets (2)	202		202		—		—
Foreign exchange derivative assets (2)	1,484		—		1,484		—
Liabilities:
Commodity derivative liabilities (2)	19,000		3,993		—		15,007
Foreign exchange derivative liabilities (2)	459		—		459		—

_________________ 

(1) Investment deposit accounts are short-term in nature, and the value is determined by principal plus interest. The investment portfolio mix can change each period based on the Company's assessment of investment options.

(2) Derivative assets and liabilities classified as Level 1 are commodity futures contracts valued based on quoted market prices in the London Metal Exchange or New York Mercantile Exchange. Amounts in Level 2 are based on broker quotes in the over-the-counter market. Derivatives classified as Level 3 are described below. Further discussion regarding the Company's use of derivative instruments is included in Note 9, Derivatives.

The fair value estimate of the Level 3 commodity derivative is based on an internally developed discounted cash flow model primarily utilizing unobservable inputs in which there is little or no market data. The Company forecasts future energy rates using a range of historical prices ("floating rate"). The floating rate is the only significant unobservable input used in the Company's discounted cash flow model.

	February 28, 2021
Unobservable Inputs	Low	High	Average
Floating rate (PLN)	151.74	264.53	221.74

Below is a reconciliation of the beginning and ending balances of the Level 3 commodity derivative recognized in the condensed consolidated statements of comprehensive income. The fluctuation in energy rates over time may cause volatility in the fair value estimate and is the primary reason for the unrealized gain in other comprehensive income ("OCI") in the three and six months ended February 28, 2021.

(in thousands)	Three Months Ended February 28, 2021
Balance, December 1, 2020	$	(13,614)
Total gains, realized and unrealized
Recognized in net earnings(1)	253
Recognized in OCI(2)	9,076
Balance, February 28, 2021	$	(4,285)
(in thousands)	Six Months Ended February 28, 2021
Balance, September 1, 2020	$	(15,007)
Total gains, realized and unrealized
Recognized in net earnings(1)	253
Recognized in OCI(2)	10,469
Balance, February 28, 2021	$	(4,285)

_________________

(1)    Gains recognized in net earnings are included in cost of goods sold in the condensed consolidated statements of earnings.

(2)    Gains recognized in OCI are included in the unrealized holding gain in the condensed consolidated statements of comprehensive income (loss).

There were no material non-recurring fair value remeasurements during the three and six months ended February 28, 2021 or February 29, 2020.

The carrying values of the Company's short-term items approximate fair value.

The carrying values and estimated fair values of the Company's financial assets and liabilities that are not required to be measured at fair value on the condensed consolidated balance sheets were as follows:

		February 28, 2021				August 31, 2020
(in thousands)	Fair Value Hierarchy	Carrying Value		Fair Value		Carrying Value		Fair Value
2031 Notes (1)	Level 2	$	300,000	$	301,674	$	—	$	—
2027 Notes (1)	Level 2	300,000		319,428		300,000		319,377
2026 Notes (1)	Level 2	—		—		350,000		367,374
2023 Notes (1)	Level 2	330,000		349,104		330,000		345,335
Poland Term Loan(2)	Level 2	40,068		40,068		40,713		40,713

_________________ 

(1) The fair value of the notes was determined based on indicated market values.

(2) The Poland Term Loan contains variable interest rates, and as a result, the carrying value approximates fair value.

XML

STOCK-BASED COMPENSATION PLANS

6 Months Ended

Feb. 28, 2021

Share-based Payment Arrangement [Abstract]

Stock-based compensation plans

The Company's stock-based compensation plans are described in Note 15, Stock-Based Compensation Plans, to the consolidated financial statements in the 2020 Form 10-K. In general, restricted stock units granted in 2021 vest ratably over a period of three years. Subject to the achievement of performance targets established by the Compensation Committee of CMC's Board of Directors, performance stock units granted in 2021 vest after a period of three years.

During the six months ended February 28, 2021 and February 29, 2020, the Company granted the following awards under its stock-based compensation plans:

	February 28, 2021			February 29, 2020
(in thousands, except per share data)	Shares Granted	Weighted Average Grant Date Fair Value		Shares Granted	Weighted Average Grant Date Fair Value
Equity method	1,512	$	20.51	1,521	$	18.32
Liability method	324	N/A		426	N/A

During the three and six months ended February 28, 2021 and February 29, 2020, the Company recorded immaterial mark-to-market adjustments on liability awards. At February 28, 2021, the Company had outstanding 711,648 equivalent shares accounted for under the liability method. The Company expects 676,065 equivalent shares to vest.

The following table summarizes total stock-based compensation expense, including fair value remeasurements, which was primarily included in selling, general and administrative expenses on the Company's condensed consolidated statements of earnings:

	Three Months Ended				Six Months Ended
(in thousands)	February 28, 2021		February 29, 2020		February 28, 2021		February 29, 2020
Stock-based compensation expense	$	12,696	$	7,536	$	21,758	$	15,805

XML

STOCKHOLDERS EQUITY AND EARNINGS PER SHARE

6 Months Ended

Feb. 28, 2021

Earnings Per Share [Abstract]

Stockholder's equity and earnings per share

The calculations of basic and diluted earnings per share from continuing operations were as follows: 

	Three Months Ended				Six Months Ended
(in thousands, except share data)	February 28, 2021		February 29, 2020		February 28, 2021		February 29, 2020
Earnings from continuing operations	$	66,233	$	63,596	$	130,144	$	146,351
Basic earnings per share:
Shares outstanding for basic earnings per share	120,345,432		118,919,455		120,052,459		118,644,823
Basic earnings per share from continuing operations	$	0.55	$	0.53	$	1.08	$	1.23
Diluted earnings per share:
Shares outstanding for basic earnings per share	120,345,432		118,919,455		120,052,459		118,644,823
Effect of dilutive securities:
Stock-based incentive/purchase plans	1,406,427		1,487,801		1,619,735		1,658,436
Shares outstanding for diluted earnings per share	121,751,859		120,407,256		121,672,194		120,303,259
Diluted earnings per share from continuing operations	$	0.54	$	0.53	$	1.07	$	1.22

Anti-dilutive shares not included above were immaterial for all periods presented.

Restricted stock is included in the number of shares of common stock issued and outstanding, but omitted from the basic earnings per share calculation until the shares vest.

During the first quarter of 2015, CMC's Board of Directors authorized a share repurchase program under which CMC may repurchase up to $100.0 million of shares of common stock. During the three and six months ended February 28, 2021, CMC did not repurchase any shares of common stock. CMC had remaining authorization to repurchase $27.6 million of common stock at February 28, 2021.

XML

COMMITMENTS AND CONTINGENCIES

6 Months Ended

Feb. 28, 2021

Commitments and Contingencies Disclosure [Abstract]

Commitments and contingencies

Legal and Environmental Matters

In the ordinary course of conducting its business, the Company becomes involved in litigation, administrative proceedings and governmental investigations, including environmental matters. See Note 19, Commitments and Contingencies, to the consolidated financial statements in the 2020 Form 10-K.

The Company has received notices from the U.S. Environmental Protection Agency ("EPA") or state agencies with similar responsibility that it is considered a potentially responsible party at several sites, none of which are owned by the Company, and may be obligated under the Comprehensive Environmental Response, Compensation and Liability Act of 1980 ("CERCLA") or similar state statutes to conduct remedial investigations, feasibility studies, remediation and/or removal of alleged releases of hazardous substances or to reimburse the EPA for such activities. The Company is involved in litigation or administrative proceedings with regard to several of these sites in which the Company is contesting, or at the appropriate time may contest, its liability at the sites. In addition, the Company has received information requests with regard to other sites which may be under consideration by the EPA as potential CERCLA sites. Some of these environmental matters or other proceedings may result in fines, penalties or judgments being assessed against the Company. At February 28, 2021 and August 31, 2020, the amounts accrued for cleanup and remediation costs in connection with CERCLA sites were immaterial. The estimation process is based on currently available information which is, in many cases, preliminary and incomplete. Total environmental liabilities, including CERCLA sites, were $6.8 million and $3.4 million at February 28, 2021 and August 31, 2020, respectively, of which $2.4 million and $2.7 million were classified as other long-term liabilities at February 28, 2021 and August 31, 2020, respectively. Due to evolving remediation technology, changing regulations, possible third-party contributions, the inherent shortcomings of the estimation process and other factors, amounts accrued could vary significantly from amounts paid. Historically, the amounts the Company has ultimately paid for such remediation activities have not been material.

Management believes that adequate provisions have been made in the Company's condensed consolidated financial statements for the potential impact of these contingencies, and that the outcomes of the suits and proceedings described above, and other miscellaneous litigation and proceedings now pending, will not have a material adverse effect on the business, results of operations or financial condition of the Company.

XML

BUSINESS SEGMENTS

6 Months Ended

Feb. 28, 2021

Segment Reporting [Abstract]

Business segments

The Company structures its business into two reportable segments: North America and Europe. See Note 1, Nature of Operations, in the 2020 Form 10-K for more information about the reportable segments, including the types of products and services from which each reportable segment derives its net sales. Corporate and Other contains earnings or losses on assets and liabilities related to the Company's Benefit Restoration Plan assets and short-term investments, expenses of the Company's corporate headquarters, interest expense related to its long-term debt and intercompany eliminations.

The following is a summary of certain financial information from continuing operations by reportable segment:

	Three Months Ended February 28, 2021
(in thousands)	North America		Europe		Corporate and Other		Continuing Operations
Net sales	$	1,257,486	$	202,066	$	2,718	$	1,462,270
Adjusted EBITDA	171,612		16,107		(45,986)		141,733
	Six Months Ended February 28, 2021
(in thousands)	North America		Europe		Corporate and Other		Continuing Operations
Net sales	$	2,452,499	$	396,662	$	4,912	$	2,854,073
Adjusted EBITDA	327,246		30,577		(72,457)		285,366
Total assets at February 28, 2021*	2,957,534		566,195		540,312		4,064,041

	Three Months Ended February 29, 2020
(in thousands)	North America		Europe		Corporate and Other		Continuing Operations
Net sales	$	1,161,283	$	180,079	$	(399)	$	1,340,963
Adjusted EBITDA	152,831		13,451		(28,561)		137,721
	Six Months Ended February 29, 2020
(in thousands)	North America		Europe		Corporate and Other		Continuing Operations
Net sales	$	2,378,003	$	345,468	$	2,200	$	2,725,671
Adjusted EBITDA	327,563		24,810		(54,847)		297,526
Total assets at August 31, 2020*	2,862,805		532,850		686,073		4,081,728

_________________ 

*Total assets listed in Corporate and Other includes assets from discontinued operations.

The following table presents a reconciliation of earnings from continuing operations to adjusted EBITDA from continuing operations:

	Three Months Ended				Six Months Ended
(in thousands)	February 28, 2021		February 29, 2020		February 28, 2021		February 29, 2020
Earnings from continuing operations	$	66,233	$	63,596	$	130,144	$	146,351
Interest expense	14,021		15,888		28,280		32,466
Income taxes	20,941		22,845		42,534		50,177
Depreciation and amortization	41,573		41,389		83,372		82,330
Amortization of acquired unfavorable contract backlog	(1,509)		(5,997)		(3,032)		(14,328)
Asset impairments	474		—		4,068		530
Adjusted EBITDA from continuing operations	$	141,733	$	137,721	$	285,366	$	297,526

Disaggregation of Revenue

The following tables display revenue by reportable segment from external customers, disaggregated by major source. The Company believes disaggregating by these categories depicts how the nature, amount, timing and uncertainty of revenue and cash flows are affected by economic factors.

	Three Months Ended February 28, 2021
(in thousands)	North America		Europe		Corporate		Total
Major product:
Raw material products	$	255,012	$	4,775	$	—	$	259,787
Steel products	514,201		157,482		—		671,683
Downstream products	400,397		33,762		—		434,159
Other	87,876		5,540		3,225		96,641
Net sales-unaffiliated customers	1,257,486		201,559		3,225		1,462,270
Intersegment net sales, eliminated on consolidation	—		507		(507)		—
Net sales	$	1,257,486	$	202,066	$	2,718	$	1,462,270
	Six Months Ended February 28, 2021
(in thousands)	North America		Europe		Corporate		Total
Major product:
Raw material products	$	465,249	$	7,605	$	—	$	472,854
Steel products	971,858		308,937		—		1,280,795
Downstream products	837,426		68,235		—		905,661
Other	177,966		10,967		5,830		194,763
Net sales-unaffiliated customers	$	2,452,499	$	395,744	$	5,830	$	2,854,073
Intersegment net sales, eliminated on consolidation	—		918		(918)		—
Net sales	$	2,452,499	$	396,662	$	4,912	$	2,854,073

	Three Months Ended February 29, 2020
(in thousands)	North America		Europe		Corporate		Total
Major product:
Raw material products	$	193,312	$	2,408	$	—	$	195,720
Steel products	437,648		147,525		—		585,173
Downstream products	441,765		23,758		—		465,523
Other	88,558		5,965		24		94,547
Net sales-unaffiliated customers	1,161,283		179,656		24		1,340,963
Intersegment net sales, eliminated on consolidation	—		423		(423)		—
Net sales	$	1,161,283	$	180,079	$	(399)	$	1,340,963
	Six Months Ended February 29, 2020
(in thousands)	North America		Europe		Corporate		Total
Major product:
Raw material products	$	374,935	$	4,613	$	—	$	379,548
Steel products	878,811		277,269		—		1,156,080
Downstream products	941,492		51,958		—		993,450
Other	182,765		10,856		2,972		196,593
Net sales-unaffiliated customers	2,378,003		344,696		2,972		2,725,671
Intersegment net sales, eliminated on consolidation	—		772		(772)		—
Net sales	$	2,378,003	$	345,468	$	2,200	$	2,725,671

XML

ACCOUNTING POLICIES (Policies)

6 Months Ended

Feb. 28, 2021

Accounting Policies [Abstract]

Accounting principles

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States ("GAAP") on a basis consistent with that used in the Annual Report on Form 10-K for the year ended August 31, 2020 ("2020 Form 10-K") filed by Commercial Metals Company ("CMC," and together with its consolidated subsidiaries, the "Company") with the Securities and Exchange Commission (the "SEC") and include all normal recurring adjustments necessary to present fairly the condensed consolidated balance sheets and the condensed consolidated statements of earnings, comprehensive income, cash flows and stockholders' equity for the periods indicated. These notes should be read in conjunction with the consolidated financial statements included in the 2020 Form 10-K. The results of operations for the three and six month periods are not necessarily indicative of the results to be expected for the full fiscal year. Any reference in this Form 10-Q to the "corresponding period" relates to the relevant three or six month period ended February 29, 2020.

Any reference in this Form 10-Q to a year refers to the fiscal year ended August 31st of that year, unless otherwise noted.

Fair value measurement

The Company has established a fair value hierarchy which prioritizes the inputs to the valuation techniques used to measure fair value into three levels. These levels are determined based on the lowest level input that is significant to the fair value measurement. Levels within the hierarchy are defined within the Summary of Significant Accounting Policies footnote in our 2020 Form 10-K.

XML

ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) (Tables)

6 Months Ended

Feb. 28, 2021

Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract]

Schedule of accumulated other comprehensive income (loss)

The following tables reflect the changes in accumulated other comprehensive income (loss) ("AOCI"):

	Three Months Ended February 28, 2021
(in thousands)	Foreign Currency Translation		Unrealized Gain (Loss) on Derivatives		Defined Benefit Obligation		Total AOCI
Balance, December 1, 2020	$	(96,321)	$	(10,224)	$	(4,510)	$	(111,055)
Other comprehensive income (loss) before reclassifications	1,465		9,535		(14)		10,986
Amounts reclassified from AOCI	—		(320)		—		(320)
Income taxes	—		(1,751)		—		(1,751)
Net other comprehensive income (loss)	1,465		7,464		(14)		8,915
Balance, February 28, 2021	$	(94,856)	$	(2,760)	$	(4,524)	$	(102,140)
	Six Months Ended February 28, 2021
(in thousands)	Foreign Currency Translation		Unrealized Gain (Loss) on Derivatives		Defined Benefit Obligation		Total AOCI
Balance, September 1, 2020	$	(87,933)	$	(11,334)	$	(4,497)	$	(103,764)
Other comprehensive income (loss) before reclassifications	(6,923)		10,972		(34)		4,015
Amounts reclassified from AOCI	—		(387)		—		(387)
Income taxes	—		(2,011)		7		(2,004)
Net other comprehensive income (loss)	(6,923)		8,574		(27)		1,624
Balance, February 28, 2021	$	(94,856)	$	(2,760)	$	(4,524)	$	(102,140)

	Three Months Ended February 29, 2020
(in thousands)	Foreign Currency Translation		Unrealized Gain (Loss) on Derivatives		Defined Benefit Obligation		Total AOCI
Balance, December 1, 2019	$	(114,574)	$	1,731	$	(3,742)	$	(116,585)
Other comprehensive loss before reclassifications	(1,066)		(4,501)		(14)		(5,581)
Amounts reclassified from AOCI	(2)		(104)		—		(106)
Income taxes	—		876		6		882
Net other comprehensive loss	(1,068)		(3,729)		(8)		(4,805)
Balance, February 29, 2020	$	(115,642)	$	(1,998)	$	(3,750)	$	(121,390)
	Six Months Ended February 29, 2020
(in thousands)	Foreign Currency Translation		Unrealized Gain (Loss) on Derivatives		Defined Benefit Obligation		Total AOCI
Balance, September 1, 2019	$	(121,498)	$	1,106	$	(3,734)	$	(124,126)
Other comprehensive income (loss) before reclassifications	5,858		(3,619)		(24)		2,215
Amounts reclassified from AOCI	(2)		(214)		—		(216)
Income taxes	—		729		8		737
Net other comprehensive income (loss)	5,856		(3,104)		(16)		2,736
Balance, February 29, 2020	$	(115,642)	$	(1,998)	$	(3,750)	$	(121,390)

XML

REVENUE RECOGNITION (Tables)

6 Months Ended

Feb. 28, 2021

Revenue from Contract with Customer [Abstract]

Information avout Assets and Liabilities from Contracts with Customers

The following table provides information about assets and liabilities from contracts with customers.

(in thousands)	February 28, 2021		August 31, 2020
Contract assets (included in accounts receivable)	$	54,468	$	53,275
Contract liabilities (included in accrued expenses and other payables)	18,638		25,450

XML

GOODWILL AND OTHER INTANGIBLES (Tables)

6 Months Ended

Feb. 28, 2021

Goodwill and Intangible Assets Disclosure [Abstract]

Changes in the carrying amount of goodwill

Goodwill by reportable segment at February 28, 2021 is detailed in the following table:

(in thousands)	North America		Europe		Consolidated
Goodwill, gross*	$	71,941	$	4,491	$	76,432
Accumulated impairment losses*	(10,036)		(161)		(10,197)
Goodwill, net*	$	61,905	$	4,330	$	66,235

_________________ 

* The change in balance from August 31, 2020 was immaterial.

XML

LEASES (Tables)

6 Months Ended

Feb. 28, 2021

Leases [Abstract]

Schedule of Balance Sheet Components of Leases

The following table presents the components of the total leased assets and lease liabilities and their classification in the Company's condensed consolidated balance sheets:

(in thousands)	Classification in Condensed Consolidated Balance Sheets	February 28, 2021		August 31, 2020
Assets:
Operating assets	Other noncurrent assets	$	117,547	$	114,905
Finance assets	Property, plant and equipment, net	52,325		50,642
Total leased assets		$	169,872	$	165,547
Liabilities:
Operating lease liabilities:
Current	Accrued expenses and other payables	$	27,176	$	27,604
Long-term	Other noncurrent liabilities	98,807		95,810
Total operating lease liabilities		125,983		123,414
Finance lease liabilities:
Current	Current maturities of long-term debt and short-term borrowings	15,228		14,373
Long-term	Long-term debt	35,992		35,851
Total finance lease liabilities		51,220		50,224
Total lease liabilities		$	177,203	$	173,638

Lease Cost

The components of lease cost were as follows:

	Three Months Ended				Six Months Ended
(in thousands)	February 28, 2021		February 29, 2020		February 28, 2021		February 29, 2020
Operating lease expense	$	8,651	$	8,815	$	17,373	$	17,605
Finance lease expense:
Amortization of assets	3,219		2,720		6,458		4,885
Interest on lease liabilities	563		465		1,118		866
Total finance lease expense	3,782		3,185		7,576		5,751
Variable and short-term lease expense	4,324		4,381		9,286		8,314
Total lease expense	$	16,757	$	16,381	$	34,235	$	31,670

The weighted average remaining lease term and discount rate for operating and finance leases are presented in the following table:

	February 28, 2021		August 31, 2020
Weighted average remaining lease term (years)
Operating leases	6.4		6.3
Finance leases	3.6		3.8
Weighted average discount rate
Operating leases	4.482	%	4.283	%
Finance leases	4.296	%	4.270	%

Cash Flow and Other Information Related to Leases

Cash flow and other information related to leases is included in the following table:

	Six Months Ended
(in thousands)	February 28, 2021		February 29, 2020
Cash paid for amounts included in the measurement of lease liabilities
Operating cash outflows from operating leases	$	17,812	$	17,594
Operating cash outflows from finance leases	1,125		787
Financing cash outflows from finance leases	7,761		6,426
Right of use ("ROU") assets obtained in exchange for lease obligations:
Operating leases	20,249		28,942
Finance leases	8,784		13,040

Maturity of Operating Lease Liabilities

Maturities of lease liabilities at February 28, 2021 are presented in the following table:

(in thousands)	Operating Leases		Finance Leases
Year 1	$	32,387	$	17,138
Year 2	26,877		14,767
Year 3	22,162		12,336
Year 4	17,182		8,716
Year 5	12,921		2,392
Thereafter	35,374		97
Total lease payments	146,903		55,446
Less: Imputed interest	20,920		4,226
Present value of lease liabilities	$	125,983	$	51,220

Maturity of Finance Lease Liabilities

Maturities of lease liabilities at February 28, 2021 are presented in the following table:

(in thousands)	Operating Leases		Finance Leases
Year 1	$	32,387	$	17,138
Year 2	26,877		14,767
Year 3	22,162		12,336
Year 4	17,182		8,716
Year 5	12,921		2,392
Thereafter	35,374		97
Total lease payments	146,903		55,446
Less: Imputed interest	20,920		4,226
Present value of lease liabilities	$	125,983	$	51,220

XML

CREDIT ARRANGEMENTS (Tables)

6 Months Ended

Feb. 28, 2021

Debt Disclosure [Abstract]

Long-term debt, including the deferred gain from the termination of the interest rate swaps

Long-term debt was as follows: 

(in thousands)	Weighted Average Interest Rate as of February 28, 2021	February 28, 2021		August 31, 2020
2031 Notes	3.875%	$	300,000	$	—
2027 Notes	5.375%	300,000		300,000
2026 Notes	5.750%	—		350,000
2023 Notes	4.875%	330,000		330,000
Poland Term Loan	1.710%	40,068		40,713
Other	5.100%	21,329		21,329
Finance leases		51,220		50,224
Total debt		1,042,617		1,092,266
Less debt issuance costs		8,805		8,581
Total amounts outstanding		1,033,812		1,083,685
Less current maturities of long-term debt		22,777		18,149
Long-term debt		$	1,011,035	$	1,065,536

XML

DERIVATIVES (Tables)

6 Months Ended

Feb. 28, 2021

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Commodity contract commitments

The following table provides information regarding the Company's commodity contract commitments at February 28, 2021:

Commodity	Long/Short	Total
Aluminum	Long	3,350	MT
Aluminum	Short	1,675	MT
Copper	Long	1,077	MT
Copper	Short	7,836	MT
Electricity	Long	1,967,000	MW(h)

_________________ 

MT = Metric Ton

MW(h) = Megawatt hour

XML

FAIR VALUE (Tables)

6 Months Ended

Feb. 28, 2021

Fair Value Disclosures [Abstract]

Financial assets and financial liabilities measured at fair value on a recurring basis

The following tables summarize information regarding the Company's financial assets and financial liabilities that were measured at fair value on a recurring basis:

			Fair Value Measurements at Reporting Date Using
(in thousands)	February 28, 2021		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant  Other Observable Inputs (Level 2)		Significant Unobservable  Inputs (Level 3)
Assets:
Investment deposit accounts (1)	$	345,240	$	345,240	$	—	$	—
Commodity derivative assets (2)	1,091		1,091		—		—
Foreign exchange derivative assets (2)	1,301		—		1,301		—
Liabilities:
Commodity derivative liabilities (2)	11,349		7,064		—		4,285
Foreign exchange derivative liabilities (2)	635		—		635		—

			Fair Value Measurements at Reporting Date Using
(in thousands)	August 31, 2020		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant  Other Observable Inputs (Level 2)		Significant Unobservable  Inputs (Level 3)
Assets:
Investment deposit accounts (1)	$	449,824	$	449,824	$	—	$	—
Commodity derivative assets (2)	202		202		—		—
Foreign exchange derivative assets (2)	1,484		—		1,484		—
Liabilities:
Commodity derivative liabilities (2)	19,000		3,993		—		15,007
Foreign exchange derivative liabilities (2)	459		—		459		—

_________________ 

(1) Investment deposit accounts are short-term in nature, and the value is determined by principal plus interest. The investment portfolio mix can change each period based on the Company's assessment of investment options.

(2) Derivative assets and liabilities classified as Level 1 are commodity futures contracts valued based on quoted market prices in the London Metal Exchange or New York Mercantile Exchange. Amounts in Level 2 are based on broker quotes in the over-the-counter market. Derivatives classified as Level 3 are described below. Further discussion regarding the Company's use of derivative instruments is included in Note 9, Derivatives.

The fair value estimate of the Level 3 commodity derivative is based on an internally developed discounted cash flow model primarily utilizing unobservable inputs in which there is little or no market data. The Company forecasts future energy rates using a range of historical prices ("floating rate"). The floating rate is the only significant unobservable input used in the Company's discounted cash flow model.

	February 28, 2021
Unobservable Inputs	Low	High	Average
Floating rate (PLN)	151.74	264.53	221.74

Fair value, net derivative asset (liability) measured on recurring basis, unobservable input reconciliation

Below is a reconciliation of the beginning and ending balances of the Level 3 commodity derivative recognized in the condensed consolidated statements of comprehensive income. The fluctuation in energy rates over time may cause volatility in the fair value estimate and is the primary reason for the unrealized gain in other comprehensive income ("OCI") in the three and six months ended February 28, 2021.

(in thousands)	Three Months Ended February 28, 2021
Balance, December 1, 2020	$	(13,614)
Total gains, realized and unrealized
Recognized in net earnings(1)	253
Recognized in OCI(2)	9,076
Balance, February 28, 2021	$	(4,285)
(in thousands)	Six Months Ended February 28, 2021
Balance, September 1, 2020	$	(15,007)
Total gains, realized and unrealized
Recognized in net earnings(1)	253
Recognized in OCI(2)	10,469
Balance, February 28, 2021	$	(4,285)

_________________

(1)    Gains recognized in net earnings are included in cost of goods sold in the condensed consolidated statements of earnings.

(2)    Gains recognized in OCI are included in the unrealized holding gain in the condensed consolidated statements of comprehensive income (loss).

Financial assets and liabilities not required to be measured at fair value

The carrying values and estimated fair values of the Company's financial assets and liabilities that are not required to be measured at fair value on the condensed consolidated balance sheets were as follows:

		February 28, 2021				August 31, 2020
(in thousands)	Fair Value Hierarchy	Carrying Value		Fair Value		Carrying Value		Fair Value
2031 Notes (1)	Level 2	$	300,000	$	301,674	$	—	$	—
2027 Notes (1)	Level 2	300,000		319,428		300,000		319,377
2026 Notes (1)	Level 2	—		—		350,000		367,374
2023 Notes (1)	Level 2	330,000		349,104		330,000		345,335
Poland Term Loan(2)	Level 2	40,068		40,068		40,713		40,713

_________________ 

(1) The fair value of the notes was determined based on indicated market values.

(2) The Poland Term Loan contains variable interest rates, and as a result, the carrying value approximates fair value.

XML

STOCK-BASED COMPENSATION PLANS (Tables)

6 Months Ended

Feb. 28, 2021

Share-based Payment Arrangement [Abstract]

Schedule of Stock Based Awards Granted

During the six months ended February 28, 2021 and February 29, 2020, the Company granted the following awards under its stock-based compensation plans:

	February 28, 2021			February 29, 2020
(in thousands, except per share data)	Shares Granted	Weighted Average Grant Date Fair Value		Shares Granted	Weighted Average Grant Date Fair Value
Equity method	1,512	$	20.51	1,521	$	18.32
Liability method	324	N/A		426	N/A

Schedule of Stock-based Compensation Expense

The following table summarizes total stock-based compensation expense, including fair value remeasurements, which was primarily included in selling, general and administrative expenses on the Company's condensed consolidated statements of earnings:

	Three Months Ended				Six Months Ended
(in thousands)	February 28, 2021		February 29, 2020		February 28, 2021		February 29, 2020
Stock-based compensation expense	$	12,696	$	7,536	$	21,758	$	15,805

XML

STOCKHOLDERS’ EQUITY AND EARNINGS PER SHARE (Tables)

6 Months Ended

Feb. 28, 2021

Earnings Per Share [Abstract]

Calculations of the basic and diluted earnings per share from continuing operations

The calculations of basic and diluted earnings per share from continuing operations were as follows: 

	Three Months Ended				Six Months Ended
(in thousands, except share data)	February 28, 2021		February 29, 2020		February 28, 2021		February 29, 2020
Earnings from continuing operations	$	66,233	$	63,596	$	130,144	$	146,351
Basic earnings per share:
Shares outstanding for basic earnings per share	120,345,432		118,919,455		120,052,459		118,644,823
Basic earnings per share from continuing operations	$	0.55	$	0.53	$	1.08	$	1.23
Diluted earnings per share:
Shares outstanding for basic earnings per share	120,345,432		118,919,455		120,052,459		118,644,823
Effect of dilutive securities:
Stock-based incentive/purchase plans	1,406,427		1,487,801		1,619,735		1,658,436
Shares outstanding for diluted earnings per share	121,751,859		120,407,256		121,672,194		120,303,259
Diluted earnings per share from continuing operations	$	0.54	$	0.53	$	1.07	$	1.22

XML

BUSINESS SEGMENTS (Tables)

6 Months Ended

Feb. 28, 2021

Segment Reporting [Abstract]

Summary of certain financial information from continuing operations by reportable segment

The following is a summary of certain financial information from continuing operations by reportable segment:

	Three Months Ended February 28, 2021
(in thousands)	North America		Europe		Corporate and Other		Continuing Operations
Net sales	$	1,257,486	$	202,066	$	2,718	$	1,462,270
Adjusted EBITDA	171,612		16,107		(45,986)		141,733
	Six Months Ended February 28, 2021
(in thousands)	North America		Europe		Corporate and Other		Continuing Operations
Net sales	$	2,452,499	$	396,662	$	4,912	$	2,854,073
Adjusted EBITDA	327,246		30,577		(72,457)		285,366
Total assets at February 28, 2021*	2,957,534		566,195		540,312		4,064,041

	Three Months Ended February 29, 2020
(in thousands)	North America		Europe		Corporate and Other		Continuing Operations
Net sales	$	1,161,283	$	180,079	$	(399)	$	1,340,963
Adjusted EBITDA	152,831		13,451		(28,561)		137,721
	Six Months Ended February 29, 2020
(in thousands)	North America		Europe		Corporate and Other		Continuing Operations
Net sales	$	2,378,003	$	345,468	$	2,200	$	2,725,671
Adjusted EBITDA	327,563		24,810		(54,847)		297,526
Total assets at August 31, 2020*	2,862,805		532,850		686,073		4,081,728

_________________ 

*Total assets listed in Corporate and Other includes assets from discontinued operations.

Reconciliations of earnings from continuing operations to adjusted operating profit

The following table presents a reconciliation of earnings from continuing operations to adjusted EBITDA from continuing operations:

	Three Months Ended				Six Months Ended
(in thousands)	February 28, 2021		February 29, 2020		February 28, 2021		February 29, 2020
Earnings from continuing operations	$	66,233	$	63,596	$	130,144	$	146,351
Interest expense	14,021		15,888		28,280		32,466
Income taxes	20,941		22,845		42,534		50,177
Depreciation and amortization	41,573		41,389		83,372		82,330
Amortization of acquired unfavorable contract backlog	(1,509)		(5,997)		(3,032)		(14,328)
Asset impairments	474		—		4,068		530
Adjusted EBITDA from continuing operations	$	141,733	$	137,721	$	285,366	$	297,526

Net sales by major product

The following tables display revenue by reportable segment from external customers, disaggregated by major source. The Company believes disaggregating by these categories depicts how the nature, amount, timing and uncertainty of revenue and cash flows are affected by economic factors.

	Three Months Ended February 28, 2021
(in thousands)	North America		Europe		Corporate		Total
Major product:
Raw material products	$	255,012	$	4,775	$	—	$	259,787
Steel products	514,201		157,482		—		671,683
Downstream products	400,397		33,762		—		434,159
Other	87,876		5,540		3,225		96,641
Net sales-unaffiliated customers	1,257,486		201,559		3,225		1,462,270
Intersegment net sales, eliminated on consolidation	—		507		(507)		—
Net sales	$	1,257,486	$	202,066	$	2,718	$	1,462,270
	Six Months Ended February 28, 2021
(in thousands)	North America		Europe		Corporate		Total
Major product:
Raw material products	$	465,249	$	7,605	$	—	$	472,854
Steel products	971,858		308,937		—		1,280,795
Downstream products	837,426		68,235		—		905,661
Other	177,966		10,967		5,830		194,763
Net sales-unaffiliated customers	$	2,452,499	$	395,744	$	5,830	$	2,854,073
Intersegment net sales, eliminated on consolidation	—		918		(918)		—
Net sales	$	2,452,499	$	396,662	$	4,912	$	2,854,073

	Three Months Ended February 29, 2020
(in thousands)	North America		Europe		Corporate		Total
Major product:
Raw material products	$	193,312	$	2,408	$	—	$	195,720
Steel products	437,648		147,525		—		585,173
Downstream products	441,765		23,758		—		465,523
Other	88,558		5,965		24		94,547
Net sales-unaffiliated customers	1,161,283		179,656		24		1,340,963
Intersegment net sales, eliminated on consolidation	—		423		(423)		—
Net sales	$	1,161,283	$	180,079	$	(399)	$	1,340,963
	Six Months Ended February 29, 2020
(in thousands)	North America		Europe		Corporate		Total
Major product:
Raw material products	$	374,935	$	4,613	$	—	$	379,548
Steel products	878,811		277,269		—		1,156,080
Downstream products	941,492		51,958		—		993,450
Other	182,765		10,856		2,972		196,593
Net sales-unaffiliated customers	2,378,003		344,696		2,972		2,725,671
Intersegment net sales, eliminated on consolidation	—		772		(772)		—
Net sales	$	2,378,003	$	345,468	$	2,200	$	2,725,671

XML

CHANGES IN BUSINESS (Details) - USD ($) $ in Millions	3 Months Ended	6 Months Ended
	Feb. 28, 2021	Feb. 28, 2021	Feb. 29, 2020
Business Combinations [Abstract]
Facility closure costs	$ 5.4	$ 13.4	$ 6.3

XML

ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) (AOCI by Components) (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Feb. 28, 2021	Feb. 29, 2020	Feb. 28, 2021	Feb. 29, 2020
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward]
Beginning balance	$ (111,055)	$ (116,585)	$ (103,764)	$ (124,126)
Other comprehensive income before reclassifications	10,986	(5,581)	4,015	2,215
Amounts reclassified from AOCI	(320)	(106)	(387)	(216)
Income taxes	(1,751)	882	(2,004)	737
Other comprehensive income (loss)	8,915	(4,805)	1,624	2,736
Ending balance	(102,140)	(121,390)	(102,140)	(121,390)
Foreign Currency Translation
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward]
Beginning balance	(96,321)	(114,574)	(87,933)	(121,498)
Other comprehensive income before reclassifications	1,465	(1,066)	(6,923)	5,858
Amounts reclassified from AOCI	0	(2)	0	(2)
Income taxes	0	0	0	0
Other comprehensive income (loss)	1,465	(1,068)	(6,923)	5,856
Ending balance	(94,856)	(115,642)	(94,856)	(115,642)
Unrealized Gain (Loss) on Derivatives
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward]
Beginning balance	(10,224)	1,731	(11,334)	1,106
Other comprehensive income before reclassifications	9,535	(4,501)	10,972	(3,619)
Amounts reclassified from AOCI	(320)	(104)	(387)	(214)
Income taxes	(1,751)	876	(2,011)	729
Other comprehensive income (loss)	7,464	(3,729)	8,574	(3,104)
Ending balance	(2,760)	(1,998)	(2,760)	(1,998)
Defined Benefit Obligation
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward]
Beginning balance	(4,510)	(3,742)	(4,497)	(3,734)
Other comprehensive income before reclassifications	(14)	(14)	(34)	(24)
Amounts reclassified from AOCI	0	0	0	0
Income taxes	0	6	7	8
Other comprehensive income (loss)	(14)	(8)	(27)	(16)
Ending balance	$ (4,524)	$ (3,750)	$ (4,524)	$ (3,750)

XML

REVENUE RECOGNITION - Revenue Recognition Method (Details) - Americas Fabrication	3 Months Ended	6 Months Ended
	Feb. 28, 2021	Feb. 28, 2021
Recognized as Amounts are Billed
Disaggregation of Revenue [Line Items]
Contract as percent of total segment revenue (percent)	80.00%	79.00%
Fabricated Product and Installation Services | Recognized over Time
Disaggregation of Revenue [Line Items]
Contract as percent of total segment revenue (percent)	11.00%	12.00%
Fabricated Product without Installation Services | Recognized over Time
Disaggregation of Revenue [Line Items]
Contract as percent of total segment revenue (percent)	9.00%	9.00%

XML

REVENUE RECOGNITION - Contract Assets and Contract Liabilities (Details) - USD ($) $ in Thousands	6 Months Ended
	Feb. 28, 2021	Aug. 31, 2020
Revenue from Contract with Customer [Abstract]
Contract assets (included in other current assets)	$ 54,468	$ 53,275
Contract liabilities (included in accrued expenses and other payables)	18,638	$ 25,450
Revenue reclassified from contract liabilities	$ 21,300

XML

REVENUE RECOGNITION - Remaining Performance Obligations (Details) $ in Millions	Feb. 28, 2021 USD ($)
Revenue from Contract with Customer [Abstract]
Remaining performance obligation	$ 688.3

XML

INVENTORIES, NET (Narrative) (Details) - USD ($) $ in Millions	Feb. 28, 2021	Aug. 31, 2020
Inventory Disclosure [Abstract]
Raw materials	$ 213.3	$ 123.9

XML

GOODWILL AND OTHER INTANGIBLES (Changes in the Carrying Amount of Goodwill) (Details) - USD ($) $ in Thousands	Feb. 28, 2021	Aug. 31, 2020
Goodwill [Line Items]
Goodwill, gross	$ 76,432
Accumulated impairment losses	(10,197)
Goodwill, net	66,235	$ 64,321
North America
Goodwill [Line Items]
Goodwill, gross	71,941
Accumulated impairment losses	(10,036)
Goodwill, net	61,905
Europe
Goodwill [Line Items]
Goodwill, gross	4,491
Accumulated impairment losses	(161)
Goodwill, net	$ 4,330

XML

GOODWILL AND OTHER INTANGIBLES (Narrative) (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Feb. 28, 2021	Feb. 29, 2020	Feb. 28, 2021	Feb. 29, 2020	Aug. 31, 2020
Goodwill and Intangible Assets Disclosure [Abstract]
Gross carrying amounts of the intangible assets subject to amortization	$ 21,800		$ 21,800		$ 22,100
Net carrying amount of intangible assets subject to amortization	11,400		11,400		12,600
Carrying amount of acquired unfavorable contract backlog liability	3,000		3,000		$ 6,000
Amortization of unfavorable contract backlog	$ 1,500	$ 6,000	$ 3,000	$ 14,300

XML

LEASES - Balance Sheet Components (Details) - USD ($) $ in Thousands	Feb. 28, 2021	Aug. 31, 2020
Leased Assets [Abstract]
Operating Lease, Right-of-Use Asset	$ 117,547	$ 114,905
Finance Lease, Right-of-Use Asset, after Accumulated Amortization	52,325	50,642
Right-of-Use Asset	169,872	165,547
Lessee, Operating Lease, Description [Abstract]
Operating Lease, Liability, Current	$ 27,176	27,604
Operating lease liabilities, Current [Extensible List]	us-gaap:AccountsPayableAndAccruedLiabilitiesCurrent
Operating Lease, Liability, Noncurrent	$ 98,807	95,810
Operating lease liabilities, Long-term [Extensible List]	us-gaap:OtherLiabilitiesNoncurrent
Operating Lease, Liability, Total	$ 125,983	123,414
Lessee, Finance Lease, Description [Abstract]
Finance Lease, Liability, Current	15,228	14,373
Finance Lease, Liability, Noncurrent	35,992	35,851
Finance Lease, Liability, Total	51,220	50,224
Lease Liability	$ 177,203	$ 173,638

XML

LEASES - Lease Cost (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Feb. 28, 2021	Feb. 29, 2020	Feb. 28, 2021	Feb. 29, 2020
Leases [Abstract]
Operating lease expense	$ 8,651	$ 8,815	$ 17,373	$ 17,605
Finance lease expense:
Amortization of assets	3,219	2,720	6,458	4,885
Interest on lease liabilities	563	465	1,118	866
Total finance lease expense	3,782	3,185	7,576	5,751
Variable and short-term lease expense	4,324	4,381	9,286	8,314
Total lease expense	$ 16,757	$ 16,381	$ 34,235	$ 31,670

XML

LEASES - Weighted Average Lease Terms and Discount Rates (Details)	Feb. 28, 2021	Aug. 31, 2020
Leases [Abstract]
Operating leases, remaining term	6 years 4 months 24 days	6 years 3 months 18 days
Finance leases, remaining term	3 years 7 months 6 days	3 years 9 months 18 days
Operating leases, weighted average discount rate	4.482%	4.283%
Finance leases, weighted average discount rate	4.296%	4.27%

XML

LEASES - Cash Flow and Other Information Related to Leases (Details) - USD ($) $ in Thousands	6 Months Ended
	Feb. 28, 2021	Feb. 29, 2020
Cash paid for amounts included in the measurement of lease liabilities
Operating cash outflows from operating leases	$ 17,812	$ 17,594
Operating cash outflows from finance leases	1,125	787
Financing cash outflows from finance leases	7,761	6,426
Right-of-Use Assets Obtained in Exchange for Lease Obligations [Abstract]
Operating leases	20,249	28,942
Finance leases	$ 8,784	$ 13,040

XML

LEASES - Maturity of Lease Liabilities (Details) - USD ($) $ in Thousands	Feb. 28, 2021	Aug. 31, 2020
Lessee, Operating Lease, Liability, Payment, Due [Abstract]
Year 1	$ 32,387
Year 2	26,877
Year 3	22,162
Year 4	17,182
Year 5	12,921
Thereafter	35,374
Total lease payments	146,903
Less: Imputed interest	20,920
Present value of lease liabilities	125,983	$ 123,414
Finance Lease, Liability, Payment, Due [Abstract]
Year 1	17,138
Year 2	14,767
Year 3	12,336
Year 4	8,716
Year 5	2,392
Thereafter	97
Total lease payments	55,446
Less: Imputed interest	4,226
Present value of lease liabilities	$ 51,220	$ 50,224

XML

CREDIT ARRANGEMENTS (Long-term Debt, Including the Deferred Gain from the Termination of the Interest Rate Swaps) (Details) - USD ($) $ in Thousands	Feb. 28, 2021	Aug. 31, 2020
Debt Instrument [Line Items]
Total debt	$ 1,042,617	$ 1,092,266
Less debt issuance costs	8,805	8,581
Total amounts outstanding	1,033,812	1,083,685
Less current maturities of long-term debt	22,777	18,149
Long-term debt	$ 1,011,035	1,065,536
2031 Notes
Debt Instrument [Line Items]
Weighted average interest rate	3.875%
Total debt	$ 300,000	0
Less debt issuance costs	$ 4,900
2027 Notes
Debt Instrument [Line Items]
Weighted average interest rate	5.375%
Total debt	$ 300,000	$ 300,000
2026 Notes
Debt Instrument [Line Items]
Weighted average interest rate	5.75%	5.75%
Total debt	$ 0	$ 350,000
2023 Notes
Debt Instrument [Line Items]
Weighted average interest rate	4.875%
Total debt	$ 330,000	330,000
Poland Term Loan | Revolving credit facility
Debt Instrument [Line Items]
Weighted average interest rate	1.71%
Total debt	$ 40,068	40,713
Other
Debt Instrument [Line Items]
Weighted average interest rate	5.10%
Total debt	$ 21,329	21,329
Finance leases
Debt Instrument [Line Items]
Total debt	$ 51,220	$ 50,224

XML

CREDIT ARRANGEMENTS (Narrative) (Details)	1 Months Ended	3 Months Ended		6 Months Ended
	Feb. 28, 2021 USD ($)	Feb. 28, 2021 USD ($)	Feb. 29, 2020 USD ($)	Feb. 28, 2021 USD ($)	Feb. 29, 2020 USD ($)	Feb. 28, 2021 PLN (zł)	Aug. 31, 2020 USD ($)	Aug. 31, 2020 PLN (zł)
Debt Instrument [Line Items]
Financial liabilities	$ 1,042,617,000	$ 1,042,617,000		$ 1,042,617,000			$ 1,092,266,000
Less debt issuance costs	8,805,000	8,805,000		8,805,000			8,581,000
Loss on debt extinguishment		(16,841,000)	$ 0	(16,841,000)	$ 0
2026 Notes
Debt Instrument [Line Items]
Early Repayment of Senior Debt	77,800,000
Financial liabilities	$ 0	$ 0		$ 0			$ 350,000,000
Long-term Debt, Weighted Average Interest Rate, at Point in Time	5.75%	5.75%		5.75%		5.75%	5.75%	5.75%
Loss on debt extinguishment		$ 16,800,000		$ 16,800,000
2031 Notes
Debt Instrument [Line Items]
Financial liabilities	$ 300,000,000.0	$ 300,000,000.0		$ 300,000,000.0			$ 0
Long-term Debt, Weighted Average Interest Rate, at Point in Time	3.875%	3.875%		3.875%		3.875%
Less debt issuance costs	$ 4,900,000	$ 4,900,000		$ 4,900,000
CMCP
Debt Instrument [Line Items]
Revolving credit facility current borrowing capacity	73,500,000	73,500,000		73,500,000		zł 275,000,000.0
CMCP | Poland Term Loan
Debt Instrument [Line Items]
Stand by letters of credit outstanding amount	900,000	900,000		900,000			800,000
Term loan, maximum principal amount	66,800,000	66,800,000		66,800,000		250,000,000.0
Financial liabilities	40,100,000	40,100,000		40,100,000		zł 150,000,000.0	40,700,000	zł 150,000,000.0
Revolving credit facility
Debt Instrument [Line Items]
Revolving credit facility, amount drawn	0	0		0			0
Revolving credit facility current borrowing capacity	350,000,000.0	350,000,000.0		350,000,000.0
Revolving credit facility | Poland Term Loan
Debt Instrument [Line Items]
Financial liabilities	$ 40,068,000	$ 40,068,000		$ 40,068,000			$ 40,713,000
Long-term Debt, Weighted Average Interest Rate, at Point in Time	1.71%	1.71%		1.71%		1.71%
Stand-by letters of credit
Debt Instrument [Line Items]
Stand by letters of credit outstanding amount	$ 3,000,000.0	$ 3,000,000.0		$ 3,000,000.0
Poland Program
Debt Instrument [Line Items]
Transfer of accounts receivable program limit	$ 58,800,000	$ 58,800,000		$ 58,800,000		zł 220,000,000.0

XML

DERIVATIVES (Narrative) (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Feb. 28, 2021	Feb. 29, 2020	Feb. 28, 2021	Feb. 29, 2020	Aug. 31, 2020
Derivative [Line Items]
Unrealized holding gain (loss)	$ 7,723	$ (3,646)	$ 8,887	$ (2,932)
Foreign exchange
Derivative [Line Items]
Derivative notional amount	165,800		165,800		$ 138,500
Commodity
Derivative [Line Items]
Derivative notional amount	$ 217,200		$ 217,200		$ 195,800

XML

DERIVATIVES (Commodity Contract Commitments) (Details) MWh in Thousands	6 Months Ended
	Feb. 28, 2021 MWh t
Aluminum | Long
Derivative [Line Items]
Commodity contract commitments	3,350
Aluminum | Short
Derivative [Line Items]
Commodity contract commitments	1,675
Copper | Long
Derivative [Line Items]
Commodity contract commitments	1,077
Copper | Short
Derivative [Line Items]
Commodity contract commitments	7,836
Electricity | Long
Derivative [Line Items]
Commodity contract commitment, electricity | MWh	1,967

XML

DERIVATIVES (Derivatives Not Designated as Hedging Instruments) (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Feb. 28, 2021	Feb. 29, 2020	Feb. 28, 2021	Feb. 29, 2020
Derivative Instruments, Gain (Loss) [Line Items]
Gain (loss) on commodity derivatives accounted for as cash flow hedging instruments	$ 7,723	$ (3,646)	$ 8,887	$ (2,932)
Commodity | Cost of goods sold
Derivative Instruments, Gain (Loss) [Line Items]
Gain (loss) before income taxes for derivatives not designated as hedges	$ (11,000)	$ 1,700	$ (16,600)	$ 400

XML

FAIR VALUE (Narrative) (Details)	6 Months Ended
	Feb. 28, 2021 levels
Fair Value Disclosures [Abstract]
Number of fair value hierarchy	3

XML

FAIR VALUE (Financial Assets and Financial Liabilities Measured at Fair Value on Recurring Basis) (Details) - USD ($)	Feb. 28, 2021	Aug. 31, 2020
Significant Unobservable Inputs (Level 3) | Minimum | Commodity | Valuation Technique, Discounted Cash Flow
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Energy floating rate	$ 151.74
Significant Unobservable Inputs (Level 3) | Maximum | Commodity | Valuation Technique, Discounted Cash Flow
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Energy floating rate	264.53
Significant Unobservable Inputs (Level 3) | Average | Commodity | Valuation Technique, Discounted Cash Flow
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Energy floating rate	221.74
Fair value, measurements, recurring | Money market investments
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Money market investments	345,240,000	$ 449,824,000
Fair value, measurements, recurring | Commodity
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets	1,091,000	202,000
Derivative liabilities	11,349,000	19,000,000
Fair value, measurements, recurring | Foreign exchange
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets	1,301,000	1,484,000
Derivative liabilities	635,000	459,000
Fair value, measurements, recurring | Quoted Prices in Active Markets for Identical Assets (Level 1) | Money market investments
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Money market investments	345,240,000	449,824,000
Fair value, measurements, recurring | Quoted Prices in Active Markets for Identical Assets (Level 1) | Commodity
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets	1,091,000	202,000
Derivative liabilities	7,064,000	3,993,000
Fair value, measurements, recurring | Quoted Prices in Active Markets for Identical Assets (Level 1) | Foreign exchange
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets	0	0
Derivative liabilities	0	0
Fair value, measurements, recurring | Significant Other Observable Inputs (Level 2) | Money market investments
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Money market investments	0	0
Fair value, measurements, recurring | Significant Other Observable Inputs (Level 2) | Commodity
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets	0	0
Derivative liabilities	0	0
Fair value, measurements, recurring | Significant Other Observable Inputs (Level 2) | Foreign exchange
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets	1,301,000	1,484,000
Derivative liabilities	635,000	459,000
Fair value, measurements, recurring | Significant Unobservable Inputs (Level 3) | Money market investments
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Money market investments	0	0
Fair value, measurements, recurring | Significant Unobservable Inputs (Level 3) | Commodity
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets	0	0
Derivative liabilities	4,285,000	15,007,000
Fair value, measurements, recurring | Significant Unobservable Inputs (Level 3) | Foreign exchange
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets	0	0
Derivative liabilities	$ 0	$ 0

XML

Fair Value (Reconciliation of Commodity Derivative Recognized in Other Comprehensive Income) (Details) - Commodity - Significant Unobservable Inputs (Level 3) - USD ($) $ in Thousands	3 Months Ended	6 Months Ended
	Feb. 28, 2021	Feb. 28, 2021
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Beginning balance	$ (13,614)	$ (15,007)
Recognized in OCI	9,076	10,469
Ending balance	(4,285)	(4,285)
Recognized in earnings	$ 253	$ 253

XML

FAIR VALUE (Financial Assets and Liabilities Not Required to Be Measured at Fair Value) (Details) - USD ($) $ in Thousands	Feb. 28, 2021	Aug. 31, 2020
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items]
Financial liabilities	$ 1,042,617	$ 1,092,266
2031 Notes
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items]
Financial liabilities	300,000	0
2031 Notes | Level 2 | Fair Value
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items]
Financial liabilities	301,674	0
2027 Notes
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items]
Financial liabilities	300,000	300,000
2027 Notes | Level 2 | Fair Value
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items]
Financial liabilities	319,428	319,377
2026 Notes
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items]
Financial liabilities	0	350,000
2026 Notes | Level 2 | Fair Value
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items]
Financial liabilities	0	367,374
2023 Notes
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items]
Financial liabilities	330,000	330,000
2023 Notes | Level 2 | Fair Value
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items]
Financial liabilities	349,104	345,335
Revolving credit facility | Poland Term Loan
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items]
Financial liabilities	40,068	40,713
Revolving credit facility | Poland Term Loan | Level 2 | Fair Value
Fair Value, Investments, Entities that Calculate Net Asset Value Per Share [Line Items]
Financial liabilities	$ 40,068	$ 40,713

XML

STOCK-BASED COMPENSATION PLANS (Narrative) (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		6 Months Ended
	Feb. 28, 2021	Feb. 28, 2019	Feb. 28, 2021	Feb. 29, 2020
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting period in years			3 years
Stock-based compensation	$ 12,696	$ 7,536	$ 21,758	$ 15,805
Equity method awards
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of shares granted			1,512,000	1,521,000
Weighted average grant-date fair value			$ 20.51	$ 18.32
Liability method awards
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of shares granted			324,000	426,000
Equivalent shares outstanding	711,648		711,648
Equivalent shares expected to vest	676,065		676,065

XML

STOCKHOLDERS EQUITY AND EARNINGS PER SHARE (Narrative) (Details) - USD ($)	3 Months Ended	6 Months Ended
	Feb. 28, 2021	Feb. 28, 2021	Nov. 30, 2014
Earnings Per Share [Abstract]
Stock repurchase program, authorized amount			$ 100,000,000.0
Stock repurchase program, shares purchased (shares)	0	0
Stock repurchase program, remaining authorized repurchase amount	$ 27,600,000	$ 27,600,000

XML

STOCKHOLDERS EQUITY AND EARNINGS PER SHARE (Calculations of the Basic and Diluted Earnings Per Share) (Details) - USD ($) $ / shares in Units, $ in Thousands		3 Months Ended		6 Months Ended
		Feb. 28, 2021	Feb. 29, 2020	Feb. 28, 2021	Feb. 29, 2020
Earnings Per Share [Abstract]
Earnings from continuing operations		$ 66,233	$ 63,596	$ 130,144	$ 146,351
Basic earnings per share:
Shares outstanding for basic earnings per share (shares)		120,345,432	118,919,455	120,052,459	118,644,823
Basic earnings per share from continuing operations (in USD per share)	[1]	$ 0.55	$ 0.53	$ 1.08	$ 1.23
Diluted earnings per share:
Shares outstanding for basic earnings per share (shares)		120,345,432	118,919,455	120,052,459	118,644,823
Effect of dilutive securities:
Stock-based incentive/purchase plans (shares)		1,406,427	1,487,801	1,619,735	1,658,436
Shares outstanding for diluted earnings per share (shares)		121,751,859	120,407,256	121,672,194	120,303,259
Diluted earnings per share from continuing operations (in USD per share)	[1]	$ 0.54	$ 0.53	$ 1.07	$ 1.22

[1] *Earnings Per Share ("EPS") is calculated independently for each component and may not sum to Net EPS due to rounding.

XML

COMMITMENTS AND CONTINGENCIES (Narrative) (Details) - CERCLA sites - USD ($) $ in Millions	Feb. 28, 2021	Aug. 31, 2020
Loss Contingencies [Line Items]
Accrual for environmental loss contingencies	$ 6.8	$ 3.4
Accrued environmental loss contingencies, noncurrent	$ 2.4	$ 2.7

XML

BUSINESS SEGMENTS (Narrative) (Details)	6 Months Ended
	Feb. 28, 2021 segments
Segment Reporting [Abstract]
Number of reporting segments	2

XML

BUSINESS SEGMENTS (Summary of Certain Financial Information from Continuing Operations by Reportable Segment and Major Product) (Details) - USD ($) $ in Thousands	3 Months Ended			6 Months Ended		9 Months Ended
	Feb. 28, 2021	May 31, 2020	Feb. 29, 2020	Feb. 28, 2021	Feb. 29, 2020	May 31, 2020	Aug. 31, 2020
Segment Reporting Information [Line Items]
Net sales	$ 1,462,270		$ 1,340,963	$ 2,854,073	$ 2,725,671
Adjusted EBITDA from continuing operations	141,733		137,721	285,366	297,526
Total assets	4,064,041			4,064,041			$ 4,081,728
Segments | Continuing Operations
Segment Reporting Information [Line Items]
Net sales	1,462,270		1,340,963	2,854,073	2,725,671
Adjusted EBITDA from continuing operations	141,733	$ 137,721		285,366		$ 297,526
Total assets	4,064,041			4,064,041			4,081,728
Segments | North America
Segment Reporting Information [Line Items]
Net sales	1,257,486		1,161,283	2,452,499	2,378,003
Adjusted EBITDA from continuing operations	171,612	152,831		327,246		327,563
Total assets	2,957,534			2,957,534			2,862,805
Segments | Europe
Segment Reporting Information [Line Items]
Net sales	202,066		180,079	396,662	345,468
Adjusted EBITDA from continuing operations	16,107	13,451		30,577		24,810
Total assets	566,195			566,195			532,850
Segments | Unaffiliated Customers
Segment Reporting Information [Line Items]
Net sales	1,462,270		1,340,963	2,854,073	2,725,671
Segments | Unaffiliated Customers | North America
Segment Reporting Information [Line Items]
Net sales	1,257,486		1,161,283	2,452,499	2,378,003
Segments | Unaffiliated Customers | Europe
Segment Reporting Information [Line Items]
Net sales	201,559		179,656	395,744	344,696
Segments | Raw material products
Segment Reporting Information [Line Items]
Net sales	259,787		195,720	472,854	379,548
Segments | Raw material products | North America
Segment Reporting Information [Line Items]
Net sales	255,012		193,312	465,249	374,935
Segments | Raw material products | Europe
Segment Reporting Information [Line Items]
Net sales	4,775		2,408	7,605	4,613
Segments | Steel Products
Segment Reporting Information [Line Items]
Net sales	671,683		585,173	1,280,795	1,156,080
Segments | Steel Products | North America
Segment Reporting Information [Line Items]
Net sales	514,201		437,648	971,858	878,811
Segments | Steel Products | Europe
Segment Reporting Information [Line Items]
Net sales	157,482		147,525	308,937	277,269
Segments | Downstream products
Segment Reporting Information [Line Items]
Net sales	434,159		465,523	905,661	993,450
Segments | Downstream products | North America
Segment Reporting Information [Line Items]
Net sales	400,397		441,765	837,426	941,492
Segments | Downstream products | Europe
Segment Reporting Information [Line Items]
Net sales	33,762		23,758	68,235	51,958
Segments | Other
Segment Reporting Information [Line Items]
Net sales	96,641		94,547	194,763	196,593
Segments | Other | North America
Segment Reporting Information [Line Items]
Net sales	87,876		88,558	177,966	182,765
Segments | Other | Europe
Segment Reporting Information [Line Items]
Net sales	5,540		5,965	10,967	10,856
Segments | Corporate
Segment Reporting Information [Line Items]
Net sales	2,718			4,912
Adjusted EBITDA from continuing operations	(45,986)
Total assets	540,312			540,312
Segments | Corporate | Unaffiliated Customers
Segment Reporting Information [Line Items]
Net sales	3,225		24	5,830	2,972
Segments | Corporate | Raw material products
Segment Reporting Information [Line Items]
Net sales	0		0	0	0
Segments | Corporate | Steel Products
Segment Reporting Information [Line Items]
Net sales	0		0	0	0
Segments | Corporate | Downstream products
Segment Reporting Information [Line Items]
Net sales	0		0	0	0
Segments | Corporate | Other
Segment Reporting Information [Line Items]
Net sales	3,225		24	5,830	2,972
Segments | Corporate and Other
Segment Reporting Information [Line Items]
Net sales			(399)		2,200
Adjusted EBITDA from continuing operations		$ (28,561)		(72,457)		$ (54,847)
Total assets							$ 686,073
Intersegment
Segment Reporting Information [Line Items]
Net sales	0		0	0	0
Intersegment | North America
Segment Reporting Information [Line Items]
Net sales	0		0	0	0
Intersegment | Europe
Segment Reporting Information [Line Items]
Net sales	507		423	918	772
Intersegment | Corporate
Segment Reporting Information [Line Items]
Net sales	$ (507)		$ (423)	$ (918)	$ (772)

XML

BUSINESS SEGMENTS (Reconciliations of Earnings from Continuing Operations to Adjusted Operating Profit) (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Feb. 28, 2021	Feb. 29, 2020	Feb. 28, 2021	Feb. 29, 2020
Segment Reporting [Abstract]
Earnings from continuing operations	$ 66,233	$ 63,596	$ 130,144	$ 146,351
Interest expense	14,021	15,888	28,280	32,466
Income taxes	20,941	22,845	42,534	50,177
Depreciation and amortization	41,573	41,389	83,372	82,330
Amortization of acquired unfavorable contract backlog	(1,509)	(5,997)	(3,032)	(14,328)
Asset impairments	474	0
Adjusted EBITDA from continuing operations	$ 141,733	$ 137,721	$ 285,366	$ 297,526