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May 2, 2012
A.M. Castle & Co., Oak Brook, Ill., improved upon its fourth-quarter performance, but still reported a loss during its first quarter. The distributor of specialty metal and plastic products reported net sales of $362.9 million and a net loss of $4.3 million in first-quarter 2012, compared to net sales of $282.9 million and a net loss of $12.0 million during fourth-quarter 2011. Compared to the same quarter of 2011, net sales were up 33 percent, though Castle reported a net income of $2.7 million a year ago.
“Sales volume was strong for the quarter, reflecting continued improvement in demand within several key end-use markets, with energy and oil and gas leading the way followed by general industrial markets,” said President and CEO Michael Goldberg during the company’s quarterly conference call with investors and analysts.
The company’s average tons sold per day, excluding its Tube Supply acquisition, was the highest since the fourth quarter of 2008. Consolidated gross material margins of 27.3 percent were also the highest the company has enjoyed since the fourth quarter of 2010.
In the Metals segment, first-quarter net sales of $331.9 million were $87.3 million, or 35.7 percent, higher than last year. Metals segment tons sold per day, excluding Tube Supply, for the first quarter of 2012 were up 9.3 percent from the first quarter of 2011 and 4.5 percent from the fourth quarter of 2011.
In the Plastics segment, first-quarter net sales of $31.0 million were $2.8 million, or 9.9 percent, higher than the prior-year period, reflecting increased pricing and improved demand across virtually all end-use markets, most notably in the automotive sector.
In December, A. M. Castle & Co. acquired Tube Supply, a leading value-added distributor of specialty tubular and bar products for the oil and gas industry, based in Houston, Texas. Tube Supply provides high-quality products and services primarily to the North American oilfield equipment manufacturing industry. Tube Supply operates two service centers, which are located in Houston, Texas, and Edmonton, Alberta. The results of Tube Supply are included in the company’s Metals segment. Tube Supply had net sales of $59.8 million for the quarter ended March 31.
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