Segment Information

6 Months Ended

Nov. 30, 2023

Segment Reporting [Abstract]

Segment Information

NOTE 15 — SEGMENT INFORMATION

We operate a portfolio of businesses and product lines that manufacture and sell a variety of specialty paints, protective coatings, roofing systems, flooring solutions, sealants, cleaners and adhesives. We manage our portfolio by organizing our businesses and product lines into four reportable segments as outlined below, which also represent our operating segments. Within each operating segment, we manage product lines and businesses which generally address common markets, share similar economic characteristics, utilize similar technologies and can share manufacturing or distribution capabilities. Our four operating segments represent components of our business for which separate financial information is available that is utilized on a regular basis by our chief operating decision maker in determining how to allocate the assets of the company and evaluate performance. These four operating segments are each managed by an operating segment manager, who is responsible for the day-to-day operating decisions and performance evaluation of the operating segment’s underlying businesses. We evaluate the profit performance of our segments primarily based on income before income taxes, but also look to earnings (loss) before interest and taxes (“EBIT”), as a performance evaluation measure because interest (income) expense, net is essentially related to corporate functions, as opposed to segment operations.

Effective June 1, 2023, certain Asia Pacific businesses and management structure, formerly of our CPG segment, were transferred to our PCG segment to create operating efficiencies and a more unified go-to-market strategy in Asia Pacific. As a result of this business realignment, $11.4 million of goodwill was transferred from the CPG segment to the PCG segment. Additionally, this realignment is reflected in our reportable segments beginning with our first quarter of fiscal 2024. As such, historical segment results have been recast to reflect the impact of this change.

Our CPG reportable segment products are sold throughout North America and also account for a significant portion of our international sales. Our construction product lines are sold directly to contractors, distributors and end-users, such as industrial manufacturing facilities, public institutions and other commercial customers. Products and services within this reportable segment include construction sealants and adhesives, coatings and chemicals, roofing systems, concrete admixture and repair products, building envelope solutions, insulated cladding, flooring systems, and weatherproofing solutions.

Our PCG reportable segment products are sold throughout North America, as well as internationally, and are sold directly to contractors, distributors and end-users, such as industrial manufacturing facilities, public institutions and other commercial customers. Products and services within this reportable segment include high-performance flooring solutions, corrosion control and fireproofing coatings, infrastructure repair systems and fiberglass reinforced plastic structures.

Our Consumer reportable segment manufactures and markets professional use and do-it-yourself (“DIY”) products for a variety of mainly consumer applications, including home improvement and personal leisure activities. Our Consumer reportable segment’s major manufacturing and distribution operations are located primarily in North America, along with a few locations in Europe, Australia and South America. Our Consumer reportable segment products are primarily sold directly to mass merchandisers, home improvement centers, hardware stores, paint stores, craft shops and through distributors. The Consumer reportable segment offers products that include specialty, hobby and professional paints; caulks; adhesives; cleaners; sandpaper and other abrasives; silicone sealants and wood stains.

Our SPG reportable segment products are sold throughout North America and internationally, primarily in Europe. Our specialty product lines are sold directly to contractors, distributors and end-users, such as industrial manufacturing facilities, public institutions and other commercial customers. The SPG reportable segment offers products that include industrial cleaners, restoration services equipment, colorants, nail enamels, exterior finishes, edible coatings and specialty glazes for pharmaceutical and food industries, and other specialty original equipment manufacturer (“OEM”) coatings.

In addition to our four reportable segments, there is a category of certain business activities and expenses, referred to as corporate/other, that does not constitute an operating segment. This category includes our corporate headquarters and related administrative expenses, results of our captive insurance companies, gains or losses on the sales of certain assets and other expenses not directly associated with any reportable segment. Assets related to the corporate/other category consist primarily of investments, prepaid expenses and headquarters’ property and equipment. These corporate and other assets and expenses reconcile reportable segment data to total consolidated income before income taxes and identifiable assets.

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

The following tables present a disaggregation of revenues by geography, and the results of our reportable segments consistent with our management philosophy, by representing the information we utilize, in conjunction with various strategic, operational and other financial performance criteria, in evaluating the performance of our portfolio of businesses.

Three Months Ended November 30, 2023	CPG Segment		PCG Segment		Consumer Segment		SPG Segment		Consolidated
(In thousands)
Net Sales (based on shipping location)
United States	$	395,961	$	221,486	$	469,353	$	145,956	$	1,232,756
Foreign
Canada		70,181		25,301		39,601		1,303		136,386
Europe		126,915		58,452		57,646		20,905		263,918
Latin America		68,693		8,572		7,127		701		85,093
Asia Pacific		-		33,852		4,960		8,117		46,929
Other Foreign		-		27,193		-		-		27,193
Total Foreign		265,789		153,370		109,334		31,026		559,519
Total	$	661,750	$	374,856	$	578,687	$	176,982	$	1,792,275
Three Months Ended November 30, 2022	CPG Segment		PCG Segment		Consumer Segment		SPG Segment		Consolidated
(In thousands)
Net Sales (based on shipping location)
United States	$	379,722	$	214,738	$	504,108	$	179,160	$	1,277,728
Foreign
Canada		65,344		22,311		44,832		1,061		133,548
Europe		115,785		57,012		49,507		20,033		242,337
Latin America		51,592		10,640		7,365		334		69,931
Asia Pacific		-		28,058		4,547		11,496		44,101
Other Foreign		-		24,063		-		-		24,063
Total Foreign		232,721		142,084		106,251		32,924		513,980
Total	$	612,443	$	356,822	$	610,359	$	212,084	$	1,791,708
Six Months Ended November 30, 2023	CPG Segment		PCG Segment		Consumer Segment		SPG Segment		Consolidated
(In thousands)
Net Sales (based on shipping location)
United States	$	905,294	$	447,814	$	1,020,106	$	299,719	$	2,672,933
Foreign
Canada		149,342		49,547		85,941		2,432		287,262
Europe		254,871		122,122		118,512		41,381		536,886
Latin America		135,032		17,713		14,142		1,316		168,203
Asia Pacific		-		63,185		9,590		13,085		85,860
Other Foreign		-		52,988		-		-		52,988
Total Foreign		539,245		305,555		228,185		58,214		1,131,199
Total	$	1,444,539	$	753,369	$	1,248,291	$	357,933	$	3,804,132
Six Months Ended November 30, 2022	CPG Segment		PCG Segment		Consumer Segment		SPG Segment		Consolidated
(In thousands)
Net Sales (based on shipping location)
United States	$	843,130	$	438,408	$	1,054,727	$	352,023	$	2,688,288
Foreign
Canada		135,482		44,973		89,082		2,047		271,584
Europe		232,980		113,720		103,125		42,158		491,983
Latin America		107,264		20,122		13,551		740		141,677
Asia Pacific		-		57,111		9,366		17,813		84,290
Other Foreign		-		46,206		-		-		46,206
Total Foreign		475,726		282,132		215,124		62,758		1,035,740
Total	$	1,318,856	$	720,540	$	1,269,851	$	414,781	$	3,724,028

	Three Months Ended						Six Months Ended
(In thousands)	November 30,			November 30,			November 30,			November 30,
Income (Loss) Before Income Taxes	2023			2022			2023			2022
CPG Segment	$	98,398		$	74,038		$	238,850		$	180,793
PCG Segment		61,502			46,709			106,323			96,110
Consumer Segment		98,066			93,873			229,895			210,562
SPG Segment		10,145			27,431			26,542			55,316
Corporate/Other		(72,287	)		(66,916	)		(136,632	)		(142,525	)
Consolidated	$	195,824		$	175,135		$	464,978		$	400,256

(In thousands)	November 30,		May 31,
Identifiable Assets	2023		2023
CPG Segment	$	2,082,505	$	2,206,403
PCG Segment		1,199,277		1,209,819
Consumer Segment		2,232,354		2,384,782
SPG Segment		774,212		804,762
Corporate/Other		249,029		176,238
Consolidated	$	6,537,377	$	6,782,004