Oct. 29, 2014
Reliance Reports Another Big Quarter
Reliance Steel & Aluminum Co., Los Angeles, reported third-quarter profits consistent with both the previous quarter and the same period in 2013. The industry-leading service center company reported net earnings of $95.9 million during the quarter, compared to $96.5 million the previous quarter and $95.1 million in the same quarter last year.
Reliance's third-quarter sales totaled a record $2.71 billion, up 10.7 percent from the same quarter last year. Compared to the previous quarter, sales were up 3.4 percent.
"We were very pleased with our operational performance during the third quarter of 2014," said Chairman and CEO David H. Hannah. "Although the typical seasonal trend is for third-quarter volumes to decline from the second quarter, our tons sold were up and well ahead of the MSCI industry trend of down 2.2 percent. Our increased volume reflects ongoing slow-but-steady improvement in customer demand."
Tons sold by Reliance increased 6.4 percent compared with the third quarter of 2013 and 0.4 percent from the second quarter, with the average selling price per ton up 4.3 percent from the prior year and 2.9 percent from the prior quarter.
"The overall pricing environment continued to improve during the third quarter, driven by strength in most of our products. Overall, we remain very pleased with the execution of our managers in the field," Hannah said.
Reliance completed two acquisitions during the quarter, both in August: Northern Illinois Steel Supply Co., Channahon, Ill., a value-added distributor and fabricator of steel components and parts, and Aluminium Services UK Ltd., which provides material management solutions to aerospace and defense OEMs and their subcontractors in Europe.
"We continue to profitably grow through M&A activity to supplement our organic growth," Hannah said. "Looking at our balance sheet, we continue to operate from a position of financial strength, and have ample liquidity to continue executing our growth strategies to create long-term shareholder value."
Among its end markets, Reliance saw strengthening in energy, aerospace, automotive and nonresidential construction. Heavy industry performed adequately despite downward pressure on agricultural equipment, company executives said. They expect metals pricing to decline somewhat in the fourth quarter given current weakness in many carbon steel products, as well as decreasing nickel prices.