Quarterly report [Sections 13 or 15(d)]

Segment Information

v3.25.2
Segment Information
 9 Months Ended
Jun. 30, 2025
Segment Reporting [Abstract]  
Segment Information Segment Information
The Company manages its businesses under three segments: Memorialization, Industrial Technologies and Brand Solutions. The Memorialization segment consists primarily of bronze and granite memorials and other memorialization products, caskets, cremation-related products, and cremation and incineration equipment primarily for the cemetery and funeral home industries. The Industrial Technologies segment includes the design, manufacturing, service and sales of high-tech custom energy storage solutions; product identification and warehouse automation technologies and solutions, including order fulfillment systems for identifying, tracking, picking and conveying consumer and industrial products; and coating and converting lines for the packaging, pharma, foil, décor and tissue industries. The Brand Solutions segment consists of brand management, pre-media services, printing plates and cylinders, imaging services, digital asset management, merchandising display systems, and marketing and design services primarily for the consumer goods and retail industries. On May 1, 2025, the Company contributed its SGK Business to a newly-formed entity, Propelis, in exchange for a 40% ownership interest in Propelis and other consideration. Propelis is expected to be a leading global provider of brand solutions. Following the completion of this transaction, the Company's Brand Solutions segment consists of its printing plates and cylinders business, and its 40% ownership interest in Propelis. Activity prior to May 1, 2025 for the SGK Business is included within the consolidated financial statements of the Company. As of May 1, 2025 the SGK Business has been deconsolidated from the financial statements and is now accounted for as part of the Company's equity-method investment in Propelis. See Notes 6, "Investments" and 15, "Acquisitions and Divestitures" for further information with respect to the Company's sale of its interest in the SGK Business.

The Company's primary measure of segment profitability is adjusted earnings before interest, income taxes, depreciation and amortization ("adjusted EBITDA"). Adjusted EBITDA is defined by the Company as earnings before interest, income taxes, depreciation, amortization and certain non-cash and/or non-recurring items that do not contribute directly to management’s evaluation of its operating results. These items include stock-based compensation, the non-service portion of pension and postretirement expense, acquisition and divestiture costs, gains and losses on divestitures, enterprise resource planning ("ERP") system integration costs, and strategic initiatives and other charges. This presentation is consistent with how the Company's chief operating decision maker (the “CODM”) evaluates the results of operations and makes strategic decisions about the business. For these reasons, the Company believes that adjusted EBITDA represents the most relevant measure of segment profit and loss.
In addition, the CODM manages and evaluates the operating performance of the segments, as described above, on a pre-corporate cost allocation basis. Accordingly, for segment reporting purposes, the Company does not allocate corporate costs to its reportable segments. Corporate costs include management and administrative support to the Company, which consists of certain aspects of the Company’s executive management, legal, compliance, human resources, information technology (including operational support) and finance departments. These costs are included within "Corporate and Non-Operating" in the following table to reconcile to consolidated adjusted EBITDA and are not considered a separate reportable segment. Management does not allocate non-operating items such as investment income, other income (deductions), net and noncontrolling interest to the segments.

Note 14.   Segment Information (continued)

The following table sets forth information about the Company's segments, including a reconciliation of adjusted EBITDA to net income.
Three Months Ended
June 30,		 Nine Months Ended
June 30,
  2025 2024 2025 2024
Sales:  
Memorialization $ 203,728  $ 202,664  $ 599,834  $ 632,891 
Industrial Technologies 87,901  91,731  249,269  319,241 
Brand Solutions 57,748  133,438  329,745  396,910 
Consolidated Sales $ 349,377  $ 427,833  $ 1,178,848  $ 1,349,042 
Adjusted EBITDA:        
Memorialization $ 42,801  $ 38,737  $ 124,451  $ 122,051 
Industrial Technologies 9,047  4,196  16,921  23,846 
Brand Solutions 5,004  16,054  32,892  44,317 
Corporate and Non-Operating (12,302) (14,241) (38,277) (43,186)
Total Adjusted EBITDA $ 44,550  $ 44,746  $ 135,987  $ 147,028 
Acquisition and divestiture related items (1)**
9,473  (2,266) (6,877) (5,565)
Strategic initiatives and other items (2)**†
(10,315) (6,246) (16,303) (17,128)
Gain on sale of SGK Business 57,103  —  57,103  — 
Highly inflationary accounting losses (primarily non-cash) (3)
(325) (185) (1,036) (895)
Stock-based compensation (8,841) (5,331) (19,838) (14,309)
Non-service pension and postretirement expense (4)
(141) (108) (407) (327)
Depreciation and amortization *
(15,836) (23,657) (56,571) (70,441)
Interest expense, including RPA and factoring financing fees (5)
(16,804) (14,005) (50,668) (40,539)
Income (loss) before income taxes 58,864  (7,052) 41,390  (2,176)
Income tax (provision) benefit (43,477) 8,829  (38,391) 10,677 
Net income $ 15,387  $ 1,777  $ 2,999  $ 8,501 
Note 14.   Segment Information (continued)

(1) Includes certain non-recurring items associated with recent acquisition and divestiture activities and also includes a loss of $2,072 for the nine months ended June 30, 2025 related to the divestiture of a business in the Industrial Technologies segment (See Note 15, "Acquisitions and Divestitures"). The fiscal 2025 third quarter amount reflects a reclassification of transaction costs totaling $9,738, which have been presented as a component of gain on sale of SGK Business.
(2) Includes certain non-recurring costs associated with commercial, operational and cost-reduction initiatives, and costs associated with global ERP system integration efforts. Also includes legal costs related to an ongoing dispute with Tesla, Inc. ("Tesla"), which totaled $5,795 and $3,166 for the three months ended June 30, 2025 and 2024, respectively, and $14,419 and $8,138 for the nine months ended June 30, 2025 and 2024, respectively (see Note 17, "Legal Matter"). Fiscal 2025 includes costs related to the Company's 2025 contested proxy which totaled $207 for the three months ended June 30, 2025 and $5,109 for the nine months ended June 30, 2025. Fiscal 2025 includes net gains on the sales of certain significant property and other assets of $8,655 for the nine months ended June 30, 2025. Fiscal 2025 also includes loss recoveries totaling $538 for the three months ended June 30, 2025 and $1,708 for the nine months ended June 30, 2025 which were related to a previously disclosed theft of funds by a former employee initially identified in fiscal 2015.
(3) Represents exchange losses associated with highly inflationary accounting related to the Company's Turkish subsidiaries (see Note 2, "Basis of Presentation").
(4) Non-service pension and postretirement expense includes interest cost, expected return on plan assets, amortization of actuarial gains and losses, curtailment gains and losses, and settlement gains and losses. These benefit cost components are excluded from adjusted EBITDA since they are primarily influenced by external market conditions that impact investment returns and interest (discount) rates. Curtailment gains and losses and settlement gains and losses are excluded from adjusted EBITDA since they generally result from certain non-recurring events, such as plan amendments to modify future benefits or settlements of plan obligations. The service cost and prior service cost components of pension and postretirement expense are included in the calculation of adjusted EBITDA, since they are considered to be a better reflection of the ongoing service-related costs of providing these benefits. Please note that GAAP pension and postretirement expense or the adjustment above are not necessarily indicative of the current or future cash flow requirements related to these employee benefit plans.
(5) Includes fees for receivables sold under the RPA and factoring arrangements totaling $974 and $1,225 for the three months ended June 30, 2025 and 2024, respectively, and $3,291 and $3,638 for the nine months ended June 30, 2025 and 2024, respectively.
* Depreciation and amortization was $7,394 and $7,073 for the Memorialization segment, $5,489 and $5,796 for the Industrial Technologies segment, $2,357 and $9,702 for the Brand Solutions segment, and $596 and $1,086 for Corporate and Non-Operating, for the three months ended June 30, 2025 and 2024, respectively. Depreciation and amortization was $21,766 and $20,400 for the Memorialization segment, $16,807 and $17,744 for the Industrial Technologies segment, $15,935 and $28,943 for the Brand Solutions segment, and $2,063 and $3,354 for Corporate and Non-Operating, for the nine months ended June 30, 2025 and 2024, respectively.
** Acquisition and divestiture costs, ERP system integration costs, and strategic initiatives and other charges were $552 and $1,108 for the Memorialization segment, $9,079 and $4,490 for the Industrial Technologies segment, $1,692 and $1,473 for the Brand Solutions segment, and income of $10,481 and costs of $1,441 for Corporate and Non-Operating, for the three months ended June 30, 2025 and 2024, respectively. Acquisition costs, ERP system integration costs, and strategic initiatives and other charges were $4,265 and $2,204 for the Memorialization segment, $15,462 and $14,288 for the Industrial Technologies segment, $2,822 and $2,694 for the Brand Solutions segment, and $631 and $3,507 for Corporate and Non-Operating, for the nine months ended June 30, 2025 and 2024, respectively.
† Strategic initiatives and other items includes charges for exit and disposal activities (including severance and other employee termination benefits) totaling expenses of $2,438 and $1,079 for the three months ended June 30, 2025 and 2024, respectively, and expenses of $1,133 and $3,862 for the nine months ended June 30, 2025 and 2024, respectively. Refer to Note 9, "Restructuring" for further details.