FRIEDMAN INDUSTRIES INC Segments Disclosure

12.   INDUSTRY SEGMENT DATA

 

The Company is engaged in the steel processing, pipe manufacturing and processing and steel and pipe distribution business. Within the Company, there are two product groups: flat-roll and tubular. The Company’s flat-roll operations consist primarily of converting steel coils into flat sheet and plate steel cut to customer specifications. Through its tubular operations, the Company purchases, processes, manufactures and markets tubular products.

 

Segment results are reviewed regularly by the Company’s Chief Operating Decision Makers (“CODMs”). The Company’s CODMs are comprised of the Chief Executive Officer and the Chief Financial Officer. The CODMs assess segment performance and allocate resources based on a number of factors with the most emphasis placed on earnings from operations.

 

The following is a summary of significant financial information relating to the product groups (in thousands):

 

		Year Ended March 31, 2025
		Flat-roll				Tubular					Other			Total
Net Sales		$	404,644			$	39,956				—			$	444,600
Cost and expenses:
Cost of materials sold			334,426				31,222				—				365,648
Processing and warehousing expense			24,544				8,933				—				33,477
Delivery expense			22,563				665				—				23,228
Commercial expense			6,301				755				—				7,056
Depreciation and amortization			2,869				304				118				3,291
General corporate expenses			—				—				9,115				9,115
			390,703				41,879				9,233				441,815
Gain (loss) on disposal of property, plant and equipment			(222	)			480				—				258
EARNINGS (LOSS) FROM OPERATIONS:			13,719				(1,443	)			(9,233	)			3,043
Gain on economic hedges of risk															7,598
Interest expense															(2,953	)
Other income															5
EARNINGS BEFORE INCOME TAXES														$	7,693
		Year Ended March 31, 2024
		Flat-roll				Tubular					Other			Total
Net Sales		$	472,774			$	43,477				—			$	516,251
Cost and expenses:
Cost of materials sold			381,591				30,804				—				412,395
Processing and warehousing expense			23,300				8,138				—				31,438
Delivery expense			23,194				597				—				23,791
Commercial expense			8,857				644				—				9,501
Depreciation and amortization			2,637				317				116				3,070
General corporate expenses			—				—				11,538				11,538
			439,548				40,497				11,688				491,733
EARNINGS (LOSS) FROM OPERATIONS:			33,226				2,980				(11,688	)			24,518
Gain on economic hedges of risk															1,848
Interest expense															(3,072	)
Other income															20
EARNINGS BEFORE INCOME TAXES														$	23,314
		Year Ended March 31,
		2025				2024
IDENTIFIABLE ASSETS:
Flat-roll		$	204,890			$	205,797
Tubular			16,792				19,589
			221,682				225,386
General corporate assets			5,140				4,633
TOTAL ASSETS		$	226,822			$	230,019
CAPITAL EXPENDITURES:
Flat-roll		$	3,823			$	5,176
Tubular			179				510
Corporate and other			—				106
TOTAL CAPITAL EXPENDITURES		$	4,002			$	5,792

 

General corporate expenses reflect general and administrative expenses not directly associated with segment operations and consist primarily of corporate and accounting salaries, professional fees and services, retirement plan contribution expense, corporate insurance expenses, restricted stock plan compensation expense and office supplies. At March 31, 2025 and 2024, corporate assets consisted primarily of cash, restricted cash, leased administrative office right-of-use assets, unamortized debt issuance costs and the cash value of officers’ life insurance. Although inventory is transferred at cost between product groups, there are no sales between product groups.