azz-20211130

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 November 30, 2021


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

Commission file number: 1-12777

AZZ Inc.

(Exact name of registrant as specified in its charter)


Texas		75-0948250
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

One Museum Place, Suite 500
3100 West 7th Street
Fort Worth,	Texas	76107
(Address of principal executive offices)		(Zip Code)

(817) 810-0095

(Registrant’s telephone number, including area code)

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

Title of each class

Trading Symbol

Name of each exchange on which registered

Common Stock

AZZ

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 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 ☒ 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 ☒ 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 December 30, 2021 the registrant had outstanding 24,692,698 shares of common stock; $1.00 par value per share.

Table of Contents

AZZ INC.

INDEX


		PAGE NO.
PART I.	FINANCIAL INFORMATION
Item 1.	Financial Statements (Unaudited)
	Condensed Consolidated Balance Sheets	3
	Condensed Consolidated Statements of Operations	4
	Condensed Consolidated Statements of Comprehensive Income	5
	Condensed Consolidated Statements of Cash Flows	6
	Condensed Consolidated Statements of Shareholders’ Equity	7
	Notes to Condensed Consolidated Financial Statements	9
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	18
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	27
Item 4.	Controls and Procedures	27

PART II.	OTHER INFORMATION
Item 1.	Legal Proceedings	28
Item 1A.	Risk Factors	28
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	29
Item 5	Other Information	29
Item 6.	Exhibits	30

	SIGNATURES	31

Table of Contents

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

AZZ INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands, except par value)Unaudited)


	November 30, 2021		February 28, 2021
Assets
Current assets:
Cash and cash equivalents	$	20,355	$	14,837
Accounts receivable (net of allowance for credit losses of $5,190 as of November 30, 2021 and $5,713 as of February 28, 2021)	144,764		128,127
Inventories:
Raw material	99,777		86,913
Work-in-process	6,152		4,453
Finished goods	1,041		1,546
Contract assets	67,884		58,056
Prepaid expenses and other	5,153		5,876
Assets held for sale	4,409		3,684
Total current assets	349,535		303,492
Property, plant and equipment, net	199,886		205,909
Operating lease right-of-use assets	45,050		37,801
Goodwill	353,434		353,881
Deferred Tax Assets	5,649		3,969
Intangibles and other assets, net	84,022		91,390
Total assets	$	1,037,576	$	996,442
Liabilities and Shareholders’ Equity
Current liabilities:
Accounts payable	$	42,457	$	41,034
Income tax payable	3,200		—
Accrued salaries and wages	23,791		22,606
Other accrued liabilities	26,478		27,136
Customer deposits	721		348
Contract liabilities	14,733		16,138
Lease liability, short-term	7,277		6,588


Total current liabilities	118,657		113,850
Debt due after one year, net	191,468		178,419
Lease liability, long-term	37,395		32,629
Deferred income taxes	36,121		39,283
Other long-term liabilities	5,891		8,969
Total liabilities	389,532		373,150
Commitments and contingencies
Shareholders’ equity:
Common stock, $1 par, shares authorized 100,000; 24,693 shares issued and outstanding at November 30, 2021 and 25,108 shares issued and outstanding at February 28, 2021	24,693		25,108
Capital in excess of par value	81,747		75,979
Retained earnings	568,641		547,289
Accumulated other comprehensive loss	(27,037)		(25,084)
Total shareholders’ equity	648,044		623,292
Total liabilities and shareholders' equity	$

SEC Form 10-Q filed by AZZ Inc.