SCHN 2017 Annual Report

SCHNITZER STEEL INDUSTRIES, INC. 48 / Schnitzer Steel Industries, Inc. Form 10-K 2017 Adjusted consolidated operating income (loss), adjustedAMR operating income (loss), adjusted CSS operating income, adjusted net income (loss) from continuing operations attributable to SSI, and adjusted diluted earnings (loss) per share from continuing operations attributable to SSI Management believes that providing these non-GAAP financial measures adds a meaningful presentation of our results from business operations excluding adjustments for goodwill impairment charges, other asset impairment charges net of recoveries, restructuring charges and other exit-related activities, recoveries related to the resale or modification of previously contracted shipments, the non-cash write-off of debt issuance costs, and income tax expense (benefit) associated with these adjustments, items which are not related to underlying business operational performance, and improves the period-to-period comparability of our results from business operations. Adjusted operating results in fiscal 2015 excluded the impact from the resale or modification of the terms, each at significantly lower prices due to sharp decline in selling prices, of certain previously contracted bulk shipments for delivery during fiscal 2015. Recoveries resulting from settlements with the original contract parties, which began in fiscal 2016, are reported within SG&A expense in the Consolidated Statements of Operations and are also excluded from the measures. The following is a reconciliation of adjusted consolidated operating income (loss), adjusted AMR operating income (loss), and adjusted CSS operating income (in thousands): Fiscal 2017 Fiscal 2016 Fiscal 2015 Consolidated operating income (loss): As reported $ 56,013 $ (7,842) $ (195,529) Goodwill impairment charges — 8,845 141,021 Other asset impairment charges (recoveries), net (717) 20,682 45,119 Restructuring charges and other exit-related activities (109) 6,781 13,008 Resale or modification of previously contracted shipments, net of recoveries (1,144) (694) 6,928 Adjusted $ 54,043 $ 27,772 $ 10,547 AMR operating income (loss): As reported $ 91,405 $ 23,168 $ (166,119) Goodwill impairment charges — 8,845 141,021 Other asset impairment charges (recoveries), net (184) 16,411 44,374 Resale or modification of previously contracted shipments, net of recoveries (1,144) (694) 6,928 Adjusted $ 90,077 $ 47,730 $ 26,204 CSS operating income (loss): As reported $ 5,275 $ 4,696 $ 20,535 Other asset impairment charges (recoveries), net (533) 4,192 — Adjusted $ 4,742 $ 8,888 $ 20,535