Nov. 23, 2016

Sales Down, Earnings Up for Russel

Russel Metals, Toronto, reported earnings of $16 million (Canadian) for the third quarter, an improvement on the $13 million earned in the same quarter last year. Sales for the quarter totaled $639 million, down 17 percent from 2015.

Russel’s service center segment reported third-quarter revenues of $349 million, 5 percent lower than the prior-year period due to weaker demand, primarily in Alberta, related to the oil and gas industry. Tons shipped by Russel’s service centers decreased by 5 percent, while the selling price per ton was comparable to the 2015 third quarter. Gross margins improved to 22.2 percent as the company benefited from value-added processing and improved steel prices early in the quarter. Operating profits for service centers totaled $17 million, a 79 percent improvement from the third-quarter 2015, the company said.

Revenues in Russel’s energy products segment decreased 28 percent in the third quarter due to reduced capital projects and drilling activity in the energy sector. Gross margins decreased slightly to 15.5 percent. The company cut operating expenses by 26 percent in line with the revenue decline. Third-quarter operating profits totaled $6 million, up from $1 million in the second quarter.

Third-quarter revenues in Russel’s steel distributors segment totaled $72 million, 30 percent lower than in third-quarter 2015 due to lower demand. Gross margins increased to 19.2 percent as metal prices strengthened. Operating profits grew to $5 million from $2 million in the same period in 2015.

Russel’s revenues for the nine months ended Sept. 30 totaled $1.9 billion, down 21 percent from 2015. Year-to-date earnings of $40 million were down 17 percent from the first three quarters last year.

"Our earnings from operations in the third quarter were stronger than our earnings in the same quarter last year,” said CEO Brian Hedges. “In the quarter, operating profits from our metals service centers and steel distributors businesses were almost double last year. Steel prices declined late in the quarter, especially in plate products. Operating profits for our energy operations improved from the second quarter, but were approximately 50 percent lower than the same quarter last year. While the timing of the energy sector recovery remains unclear, we remain one of the few energy product distributors that have demonstrated the ability to generate a profit from operations at the bottom of the energy cycle."


September 2017: Numbers Don’t Add Up for Service Centers
More...
 
Pause
September 2017: Lichtenstein: Five Steel Truths that Demand Attention
More...
Fall 2016: Cutting & Sawing Equipment
More...
Summer 2017
More...
 
Pause
Advanced Controls on Braner Slitters
More...
AHVS Precision Leveler Features Flip-Top Design
More...
Formtek’s Tishken Slitter Increases Production Volume
More...
Red Bud System Handles High-Strength Steels
More...
Bradbury Launches Flat Trak CL Monitoring System
More...
Artus Knives Custom Designed
More...
 
Pause
Privacy Statement  |  Terms Of Use
Copyright by Metal Center News



Wednesday, October 18, 2017