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Operating Segments
 9 Months Ended
Nov. 30, 2024
Segment Reporting [Abstract]  
Operating Segments
6. Operating Segments
Segment Information
Our Chief Executive Officer, who is the chief operating decision maker ("CODM"), reviews financial information presented on an operating segment basis for purposes of making operating decisions and assessing financial performance. Sales and operating income are the primary measures used by the CODM to evaluate segment operating performance and to allocate resources to the AZZ Metal Coatings and the AZZ Precoat Metals segments, and net income is the primary measure used by the CODM to evaluate performance and allocate resources to the AZZ Infrastructure Solutions segment. Expenses related to certain centralized administration or executive functions that are not specifically related to an operating segment are included in Corporate.
A summary of each of our operating segments is as follows:
AZZ Metal Coatings — provides hot-dip galvanizing, spin galvanizing, powder coating, anodizing and plating, and other metal coating applications to the steel fabrication industry and other industries through facilities located throughout North America. Hot-dip galvanizing is a metallurgical manufacturing process in which molten zinc reacts with steel, which provides corrosion protection and extends the lifecycle of fabricated steel for several decades.
AZZ Precoat Metals — provides coil coating application of protective and decorative coatings and related value-added downstream processing for steel and aluminum coils. Primarily serving the construction, appliance, heating, ventilation, and air conditioning (HVAC), container, transportation, and other end markets, the coil coating process emphasizes sustainability and enhanced product lifecycles. It involves cleaning, treating, painting, and curing metal coils as a flat material before they are cut, formed, and fabricated into finished products. This highly efficient method optimizes waste through tight film control and improves final product performance by painting and curing the substrates under conditions unmatched by other application processes.

AZZ Infrastructure Solutions — consists of the equity in earnings of our 40% investment in the AVAIL JV, as well as other expenses directly related to AIS receivables and liabilities that were retained following the divestiture of the AIS business. The AVAIL JV is a global provider of application-critical equipment, highly engineered technologies, and specialized services to the power generation, transmission, distribution, oil and gas, and industrial markets.
The following tables contain operating segment data for the three and nine months ended November 30, 2024 and 2023 by segment, for the Company's corporate operations and on a consolidated basis (in thousands):
Three Months Ended November 30, 2024
Metal CoatingsPrecoat Metals
Infrastructure Solutions(1)
Corporate(2)
Total
Sales$168,599 $235,055 $— $— $403,654 
Cost of sales116,542 189,334 — — 305,876 
Gross margin52,057 45,721 — — 97,778 
Selling, general and administrative5,684 8,641 29 24,889 39,243 
Operating income (loss)46,373 37,080 (29)(24,889)58,535 
Interest expense— — — (19,223)(19,223)
Equity in earnings of unconsolidated subsidiaries— — 7,168 — 7,168 
Other income (expense)116 — — (879)(763)
Income (loss) before income tax$46,489 $37,080 $7,139 (44,991)45,717 
Income tax expense12,114 12,114 
Net income (loss)$(57,105)$33,603 
See notes below tables.
Nine Months Ended November 30, 2024
Metal CoatingsPrecoat Metals
Infrastructure Solutions(1)
Corporate(2)
Total
Sales$516,750 $709,119 $— $— $1,225,869 
Cost of sales357,471 564,436 — — 921,907 
Gross margin159,279 144,683 — — 303,962 
Selling, general and administrative17,286 24,980 67 65,699 108,032 
Operating income (loss)141,993 119,703 (67)(65,699)195,930 
Interest expense— — — (63,906)(63,906)
Equity in earnings of unconsolidated subsidiaries— — 12,470 — 12,470 
Other income (expense)165 — — (307)(142)
Income (loss) before income tax$142,158 $119,703 $12,403 (129,912)144,352 
Income tax expense35,728 35,728 
Net income (loss)$(165,640)$108,624 
See notes below tables.
Three Months Ended November 30, 2023
Metal CoatingsPrecoat Metals
Infrastructure Solutions(1)
Corporate(2)
Total
Sales$163,186 $218,419 $— $— $381,605 
Cost of sales115,952 177,504 — — 293,456 
Gross margin47,234 40,915 — — 88,149 
Selling, general and administrative9,392 8,163 290 17,480 35,325 
Operating income (loss)37,842 32,752 (290)(17,480)52,824 
Interest expense— — — (25,855)(25,855)
Equity in earnings of unconsolidated subsidiaries— — 8,742 — 8,742 
Other expense(29)— — (12)(41)
Income (loss) before income tax$37,813 $32,752 $8,452 (43,347)35,670 
Income tax expense8,780 8,780 
Net income (loss)$(52,127)$26,890 
See notes below tables.

Nine Months Ended November 30, 2023
Metal CoatingsPrecoat Metals
Infrastructure Solutions(1)
Corporate(2)
Total
Sales$501,816 $669,204 $— $— $1,171,020 
Cost of sales353,280 535,326 — — 888,606 
Gross margin148,536 133,878 — — 282,414 
Selling, general and administrative20,143 24,429 6,244 52,271 103,087 
Operating income (loss)128,393 109,449 (6,244)(52,271)179,327 
Interest expense— — — (82,331)(82,331)
Equity in earnings of unconsolidated subsidiaries— — 11,136 — 11,136 
Other income (expense)(40)— — 49 9 
Income (loss) before income tax$128,353 $109,449 $4,892 (134,553)108,141 
Income tax expense24,397 24,397 
Net income (loss)$(158,950)$83,744 
(1) Infrastructure Solutions segment includes the equity in earnings from our investment in the AVAIL JV, as well as other expenses related to
receivables and liabilities that were retained following the sale of the AIS business.
(2) Interest expense and Income tax expense are included in the Corporate segment as these items are not allocated to the segments.
Asset balances by operating segment for each period were as follows (in thousands):
As of
November 30, 2024February 29, 2024
Assets:
Metal Coatings$551,379 $553,505 
Precoat Metals1,559,262 1,500,122 
Infrastructure Solutions - Investment in Joint Venture102,121 98,169 
Corporate31,788 43,709 
Total assets$2,244,550 $2,195,505 

Financial Information About Geographical Areas
Financial information about geographical areas for the periods presented was as follows (in thousands). The geographic area is based on the location of the operating facility and no customer accounted for 10% or more of consolidated sales.
Three Months Ended November 30,Nine Months Ended November 30,
2024202320242023
Sales:
United States$392,503 $370,485 $1,194,212 $1,140,344 
Canada11,151 11,120 31,657 30,676 
Total$403,654 $381,605 $1,225,869 $1,171,020 

As of
November 30, 2024February 29, 2024
Property, plant and equipment, net:
United States$561,326 $522,693 
Canada18,852 18,959 
Total$580,178 $541,652