ADVANCED DRAINAGE SYSTEMS, INC.WMS
ADVANCED DRAINAGE SYSTEMS, INC. Segments Disclosure
BUSINESS SEGMENT INFORMATION
Following the acquisition of NDS the Company realigned its reportable segments to align with the manner in which the CODM assesses performance and makes resource allocation decisions. ADS operates its business in two distinct reportable segments: “Stormwater” and “Wastewater”, which are primarily organized based on products. The CODM for ADS is the Chief Executive Officer (“CEO”). The CEO reviews financial information and makes operational decisions based on Net sales and a measure of operating profit, Segment Adjusted EBITDA, a non-GAAP financial measure.
Certain selling and general and administrative expenses are not allocated to the segments, including non-operating functions such as legal, facilities management, and investor relations. A measure of assets is not applicable, as segment assets are not regularly reviewed by the CODM for evaluating performance or allocating resources. The Company does not aggregate operating segments to form reportable segments.
Stormwater - The Stormwater segment manufactures and markets high performance thermoplastic corrugated pipe and complementary products, including single wall pipe, N-12 HDPE pipe, high performance polypropylene pipe, StormTech, Nyloplast, Inserta Tee, Cultec, water quality filters and structures, Fittings, FlexStorm and NDS channel drains, catch basins and access boxes. Stormwater products are sold throughout the United States and certain international regions, including Company owned facilities in Canada, subsidiaries that distribute to Europe and the Middle East, and exports through the Company’s joint ventures with local partners in Mexico and South America. The Company maintains and serves these markets through product distribution relationships with many of the largest waterworks distributors, buying groups and co-ops, major retailers as well as an extensive network of hundreds of small to medium-sized distributors. Products are designed primarily for stormwater management in the construction and infrastructure marketplace across a broad range of end markets and applications, including non-residential, residential, agriculture and infrastructure.
Wastewater - Wastewater (formerly Infiltrator) is a leading national provider of plastic leachfield chambers and systems, onsite wastewater tanks and accessories, primarily for use in residential applications. Infiltrator products are used in onsite wastewater treatment systems in the United States and Canada.
The following tables set forth Net sales, significant segment expenses, and Adjusted EBITDA for each of the Company’s reportable segments for the fiscal years ended March 31:
| Fiscal Year Ended March 31, 2026 | |||||||||||||||||||||||
| (Amounts in thousands) | Stormwater | Wastewater | Intersegment Eliminations | Total | |||||||||||||||||||
| Net sales: | |||||||||||||||||||||||
| Net sales from external customers | $ | 2,397,414 | $ | 652,962 | $ | — | $ | 3,050,376 | |||||||||||||||
| Intersegment net sales | 36,466 | 61,580 | (98,046) | — | |||||||||||||||||||
| Net sales | 2,433,880 | 714,542 | (98,046) | 3,050,376 | |||||||||||||||||||
| Significant segment expenses: | |||||||||||||||||||||||
| Costs of goods sold | 1,613,170 | 367,963 | (98,143) | 1,882,990 | |||||||||||||||||||
| Selling, general and administrative expenses | 348,829 | 69,002 | — | 417,831 | |||||||||||||||||||
Other segment items(a) | (231,194) | (33,875) | — | (265,069) | |||||||||||||||||||
Segment Adjusted EBITDA(b) | $ | 703,075 | $ | 311,452 | $ | 97 | |||||||||||||||||
Corporate and other costs(c) | 51,718 | ||||||||||||||||||||||
| Total consolidated Adjusted EBITDA | $ | 962,906 | |||||||||||||||||||||
| Reconciliation of total consolidated Adjusted EBITDA to income from continuing operations before income taxes: | |||||||||||||||||||||||
| Interest expense | 93,869 | ||||||||||||||||||||||
| Interest income | (25,000) | ||||||||||||||||||||||
| Depreciation and amortization | 216,261 | ||||||||||||||||||||||
| Stock-based compensation expense | 32,354 | ||||||||||||||||||||||
| Loss (gain) on disposal of assets and costs from exit and disposal activities | 19,211 | ||||||||||||||||||||||
Transaction costs(d) | 40,805 | ||||||||||||||||||||||
Other adjustments(e) | 25,618 | ||||||||||||||||||||||
| Income before income taxes | 559,788 | ||||||||||||||||||||||
| Income tax expense | 134,988 | ||||||||||||||||||||||
| Equity in net income of unconsolidated affiliates | (5,063) | ||||||||||||||||||||||
| Net income from continuing operations | $ | 429,863 | |||||||||||||||||||||
(a)Other segment items include depreciation, amortization recorded within cost of goods sold, stock-based compensation expense, inventory step-up costs, restructuring and realignment expense, and transaction costs.
(b)The Company calculates Segment Adjusted EBITDA as net income from continuing operations before interest, income taxes, depreciation and amortization, stock-based compensation expense, non-cash charges and certain other gains and expenses.
(c)Represents certain unallocated selling, general and administrative expenses required to reconcile segment Adjusted EBITDA to consolidated Adjusted EBITDA.
(d)Represents expenses recorded related to legal, accounting and other professional fees incurred in connection with business or asset acquisitions and dispositions.
(e)Includes derivative fair value adjustments, foreign currency transaction (gains) losses, legal settlements, inventory step-up costs, restructuring and realignment expense, and executive retirement expense (benefit).
| Fiscal Year Ended March 31, 2025 | |||||||||||||||||||||||
| (Amounts in thousands) | Stormwater | Wastewater | Intersegment Eliminations | Total | |||||||||||||||||||
| Net sales: | |||||||||||||||||||||||
| Net sales from external customers | $ | 2,326,370 | $ | 577,875 | $ | — | $ | 2,904,245 | |||||||||||||||
| Intersegment net sales | 35,647 | 52,031 | (87,678) | — | |||||||||||||||||||
| Net sales | 2,362,017 | 629,906 | (87,678) | 2,904,245 | |||||||||||||||||||
| Significant segment expenses: | |||||||||||||||||||||||
| Costs of goods sold | 1,582,828 | 314,465 | (87,289) | 1,810,004 | |||||||||||||||||||
| Selling, general and administrative expenses | 282,877 | 55,186 | — | 338,063 | |||||||||||||||||||
Other segment items(a) | (143,608) | (31,757) | — | (175,365) | |||||||||||||||||||
Segment Adjusted EBITDA(b) | $ | 639,920 | $ | 292,012 | $ | (389) | |||||||||||||||||
Corporate and other costs(c) | 42,315 | ||||||||||||||||||||||
| Total consolidated Adjusted EBITDA | $ | 889,228 | |||||||||||||||||||||
| Reconciliation of total consolidated Adjusted EBITDA to income from continuing operations before income taxes: | |||||||||||||||||||||||
| Interest expense | 91,803 | ||||||||||||||||||||||
| Interest income | (23,485) | ||||||||||||||||||||||
| Depreciation and amortization | 183,281 | ||||||||||||||||||||||
| Stock-based compensation expense | 26,581 | ||||||||||||||||||||||
| Loss (gain) on disposal of assets and costs from exit and disposal activities | 3,858 | ||||||||||||||||||||||
Transaction costs(d) | 9,291 | ||||||||||||||||||||||
Other adjustments(e) | 8,434 | ||||||||||||||||||||||
| Income before income taxes | 589,465 | ||||||||||||||||||||||
| Income tax expense | 141,063 | ||||||||||||||||||||||
| Equity in net income of unconsolidated affiliates | (4,171) | ||||||||||||||||||||||
| Net income from continuing operations | $ | 452,573 | |||||||||||||||||||||
(a)Other segment items include depreciation, amortization recorded within cost of goods sold, stock-based compensation expense, inventory step-up cost, restructuring and realignment expense, and transaction costs.
(b)The Company calculates Segment Adjusted EBITDA as net income from continuing operations before interest, income taxes, depreciation and amortization, stock-based compensation expense, non-cash charges and certain other gains and expenses.
(c)Represents certain unallocated selling, general and administrative expenses required to reconcile segment Adjusted EBITDA to consolidated Adjusted EBITDA.
(d)Represents expenses recorded related to legal, accounting and other professional fees incurred in connection with business or asset acquisitions and dispositions.
(e)Includes derivative fair value adjustments, foreign currency transaction (gains) losses, legal settlements, inventory step-up costs, restructuring and realignment expense, and executive retirement expense (benefit).
| Fiscal Year Ended March 31, 2024 | |||||||||||||||||||||||
| (Amounts in thousands) | Stormwater | Wastewater | Intersegment Eliminations | Total | |||||||||||||||||||
| Net sales: | |||||||||||||||||||||||
| Net sales from external customers | $ | 2,361,520 | $ | 512,953 | $ | — | $ | 2,874,473 | |||||||||||||||
| Intersegment net sales | 30,649 | 53,597 | (84,246) | — | |||||||||||||||||||
| Net sales | 2,392,169 | 566,550 | (84,246) | 2,874,473 | |||||||||||||||||||
| Significant segment expenses: | |||||||||||||||||||||||
| Costs of goods sold | 1,525,826 | 283,740 | (81,042) | 1,728,524 | |||||||||||||||||||
| Selling, general and administrative expenses | 275,342 | 40,639 | — | 315,981 | |||||||||||||||||||
Other segment items(a) | (122,966) | (24,746) | — | (147,712) | |||||||||||||||||||
Segment Adjusted EBITDA(b) | $ | 713,967 | $ | 266,917 | $ | (3,204) | |||||||||||||||||
Corporate and other costs(c) | 54,733 | ||||||||||||||||||||||
| Total consolidated Adjusted EBITDA | $ | 922,947 | |||||||||||||||||||||
| Reconciliation of total consolidated Adjusted EBITDA to income from continuing operations before income taxes: | |||||||||||||||||||||||
| Interest expense | 88,862 | ||||||||||||||||||||||
| Interest income | (22,047) | ||||||||||||||||||||||
| Depreciation and amortization | 154,903 | ||||||||||||||||||||||
| Stock-based compensation expense | 31,986 | ||||||||||||||||||||||
| Loss (gain) on disposal of assets and costs from exit and disposal activities | (8,365) | ||||||||||||||||||||||
Transaction costs(d) | 3,444 | ||||||||||||||||||||||
Other adjustments(e) | 7,411 | ||||||||||||||||||||||
| Income before income taxes | 666,753 | ||||||||||||||||||||||
| Income tax expense | 158,998 | ||||||||||||||||||||||
| Equity in net income of unconsolidated affiliates | (5,536) | ||||||||||||||||||||||
| Net income from continuing operations | $ | 513,291 | |||||||||||||||||||||
(a)Other segment items include depreciation, amortization recorded within cost of goods sold, stock-based compensation expense, inventory step-up costs, restructuring and realignment expense, and transaction costs.
(b)The Company calculates Segment Adjusted EBITDA as net income from continuing operations before interest, income taxes, depreciation and amortization, stock-based compensation expense, non-cash charges and certain other gains and expenses.
(c)Represents certain unallocated selling, general and administrative expenses required to reconcile segment Adjusted EBITDA to consolidated Adjusted EBITDA.
(d)Represents expenses recorded related to legal, accounting and other professional fees incurred in connection with business or asset acquisitions and dispositions.
(e)Includes derivative fair value adjustments, foreign currency transaction (gains) losses, legal settlements, inventory step-up costs, restructuring and realignment expense, and executive retirement expense (benefit).
Other Segment Information - The following sets forth certain financial information for the fiscal years ended March 31:
| (Amounts in thousands) | 2026 | 2025 | 2024 | ||||||||||||||
| Depreciation and amortization | |||||||||||||||||
| Stormwater | $ | 126,387 | $ | 102,574 | $ | 81,602 | |||||||||||
| Wastewater | 80,423 | 74,068 | 69,121 | ||||||||||||||
| Other | 9,451 | 6,639 | 4,180 | ||||||||||||||
| Total | $ | 216,261 | $ | 183,281 | $ | 154,903 | |||||||||||
| Capital expenditures | |||||||||||||||||
| Stormwater | $ | 157,381 | $ | 175,918 | $ | 128,313 | |||||||||||
| Wastewater | 30,509 | 13,733 | 17,882 | ||||||||||||||
| Other | 61,876 | 23,293 | 37,617 | ||||||||||||||
| Total | $ | 249,766 | $ | 212,944 | $ | 183,812 | |||||||||||
Geographic Sales and Assets Information - Net sales are attributed to the geographic location based on the location of the customer. The table below represents the Net sales and long-lived asset information by geographic location for each of the fiscal years ended March 31:
| (Amounts in thousands) | 2026 | 2025 | 2024 | ||||||||||||||
| Net Sales | |||||||||||||||||
| United States | $ | 2,857,553 | $ | 2,709,615 | $ | 2,666,704 | |||||||||||
| Canada | 119,270 | 119,492 | 126,050 | ||||||||||||||
| Other | 73,553 | 75,138 | 81,719 | ||||||||||||||
| Total | $ | 3,050,376 | $ | 2,904,245 | $ | 2,874,473 | |||||||||||
| (Amounts in thousands) | 2026 | 2025 | |||||||||
Long-Lived Assets (a) | |||||||||||
| United States | $ | 1,169,184 | $ | 1,016,681 | |||||||
| Canada | 32,367 | 30,655 | |||||||||
| Other | 55,610 | 39,529 | |||||||||
| Total | $ | 1,257,161 | $ | 1,086,865 | |||||||
(a) For segment reporting purposes, long-lived assets include Investments in unconsolidated affiliates, Central parts and Property, plant and equipment.
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Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2026 | May 21, 2026 | Showing above |
| 2025 | May 15, 2025 | |
| 2024 | May 16, 2024 | |
| 2023 | May 18, 2023 | |
| 2022 | May 19, 2022 | |
| 2021 | May 27, 2021 | |
| 2020 | Jun 1, 2020 | |
| 2019 | May 30, 2019 | |
| 2018 | May 30, 2018 | |
| 2017 | May 30, 2017 | |
| 2016 | Sep 15, 2016 | |
| 2015 | Mar 29, 2016 | |
About Segments Disclosures
Segment disclosures break a company into its reportable operating units, revealing revenue, profit, and asset allocation that consolidated financial statements obscure. Under ASC 280, segments must match how the chief operating decision maker views the business, providing a window into internal management structure and resource allocation priorities.
Key signals: compare segment margins to identify which units drive profitability and which destroy value. Watch for changes in the number of reportable segments — segment aggregation or disaggregation often coincides with strategic shifts or attempts to obscure declining performance. Intersegment elimination patterns reveal internal pricing practices. The reconciliation between segment totals and consolidated figures exposes corporate overhead allocation and unallocated items. Geographic revenue concentration highlights regulatory and currency exposure. Compare segment-level capital expenditure against segment revenue to assess where management is investing for future growth versus harvesting existing assets.