Note 14 - Segments

3 Months Ended

Mar. 01, 2025

Segment Reporting Disclosure [Text Block]

Note 14: Segments

We are required to report segment information in the same way that we internally organize our business for assessing performance and making decisions regarding allocation of resources. Revenue and operating income of each of our segments are regularly reviewed by our chief operating decision maker to make decisions about resources to be allocated to the segments and assess their performance. Segment operating income is identified as gross profit less SG&A expenses. Corporate expenses, other than those included in Corporate Unallocated, are allocated to each operating segment. Consistent with our internal management reporting, Corporate Unallocated amounts include business acquisition and integration costs, organizational restructuring charges and project costs associated with implementing a global Enterprise Resource Planning (“ERP”) system that we refer to as Project ONE. Corporate assets are not allocated to the operating segments. Inter-segment revenues are recorded at cost plus a markup for administrative costs.

As of November 30, 2024, our three operating segments consisted of Hygiene, Health and Consumable Adhesives, Engineering Adhesives and Construction Adhesives. As of the beginning of fiscal 2025, we reorganized our operating segments by selling our North American Flooring business ("NA Flooring"), previously part of the Construction Adhesives operating segment, and combining our Insulated Glass, Woodworking and Composite businesses, previously part of the Engineering Adhesives operating segment, with Construction Adhesives Roofing and Building Envelope and Infrastructure businesses to form the newly named Building Adhesive Solutions operating segment. All financial results related to NA Flooring have been moved to our Corporate Unallocated segment. Prior period segment information has been recast retrospectively to reflect the realignment. Operating results of each of these segments are regularly reviewed by our chief operating decision maker to make decisions about resources to be allocated to the segments and assess their performance.

The table below provides certain information regarding net revenue and operating income (loss) for each of our operating segments.

	*Three Months Ended*
	*March 1, 2025*					*March 2, 2024*
	*Net*		*Operating*			*Net*		*Operating*
	*Revenue*		*Income (Loss)*			*Revenue*		*Income (Loss)*
Hygiene, Health and Consumable Adhesives	$	368,225	$	29,949		$	368,078	$	47,393
Engineering Adhesives		236,758		28,051			226,075		25,820
Building Adhesive Solutions		183,680		6,577			179,666		7,139
Total segment	$	788,663	$	64,577		$	773,819	$	80,352
Corporate Unallocated		-		(18,130	)		36,600		(13,477	)
Total	$	788,663	$	46,447		$	810,419	$	66,875

The table below provides a reconciliation of operating income to income before income taxes and income from equity method investments:

	*Three Months Ended*
	*March 1,*			*March 2,*
	*2025*			*2024*
Operating income	$	46,447		$	66,875
Other income, net		3,207			1,501
Interest expense		(32,042	)		(31,901	)
Interest income		1,100			1,307
Income before income taxes and income from equity method investments	$	18,712		$	37,782

The table below provides total assets as of November 30, 2024, restated for our new operating segments:

	November 30,
	2024
Hygiene, Health and Consumable Adhesives	$	1,610,902
Engineering Adhesives		1,533,675
Building Adhesive Solutions		1,239,527
Corporate		549,140
Total	$	4,933,244

We view the following disaggregation of net revenue by geographic region as useful to understanding the composition of revenue recognized during the respective reporting periods:

Three Months Ended March 1, 2025

Hygiene, Health

Building

and Consumable

Engineering

Adhesive

Corporate

Adhesives

Solutions

Unallocated

Total

Americas

207,354

97,209

95,700

400,263

EIMEA

110,767

50,262

75,163

236,192

Asia Pacific

50,104

89,287

12,817

152,208

Total

368,225

236,758

183,680

788,663

	*Three Months Ended March 2, 2024*

	*Hygiene, Health*				*Building*
	*and Consumable*		*Engineering*		*Adhesive*		*Corporate*
	*Adhesives*		*Adhesives*		*Solutions*		*Unallocated*		*Total*

Americas	$	217,386	$	88,075	$	89,240	$	36,600	$	431,301
EIMEA		103,253		54,533		76,580		-		234,366
Asia Pacific		47,439		83,467		13,846		-		144,752
Total	$	368,078	$	226,075	$	179,666	$	36,600	$	810,419

- Definition

The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments.

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+ Details

FULLER H B CO 10-Q