Aug. 2, 2017

Reliance Sales, Profits Show Growth in Second Quarter

Reliance Steel & Aluminum, Los Angeles, reported net income of $103.0 million, a 2.1 percent increase from the second quarter of 2016, but down 7.8 percent from the prior quarter. Year-to-date earnings of $214.7 million were up 11.2 percent compared with the prior year.

Net sales in the quarter totaled $2.48 billion, a 12.3 percent increase from 2016 and up 2.3 percent from the previous quarter. Six-month net sales were up 12.1 percent to $4.89 billion compared with 2016.

“Continued steady demand, along with strong execution by our managers in the field, resulted in a gross profit margin of 28.4 percent, driving our second-highest quarterly gross profit dollars in the company’s history. Current pricing levels are higher than both the first quarter of 2017 and the second quarter of 2016, which positively contributed to our earnings,” said Gregg Mollins, president and CEO of Reliance at the company’s quarterly conference call with investors and analysts.

Reliance sold 1.5 million tons in the quarter, a 1.4 percent gain over the second quarter of 2016 but flat with the first quarter. The average selling price of $1,517 per ton was up 1.1 percent from a year earlier, but down slightly from the first quarter.

Reliance’s carbon steel sales of $1.3 billion were up 13.6 percent from 2016. Aluminum sales increased 5.4 percent to $487.8 million, stainless steel sales climbed 12.2 percent to $348.0 million and alloy sales were up 31.8 percent to $145.8 million.

Overall healthy customer demand levels continued throughout the second quarter of 2017, executives said. Automotive demand remained solid, aerospace was strong, and nonresidential construction and energy both continued to grow.

Reliance management remains cautiously optimistic about business activity levels in the third quarter of 2017, subject to normal seasonal patterns. The company expects current demand will remain steady, except for the typical third quarter decline in shipping volume due to customer shutdowns and vacation schedules. The company estimates tons sold will be down 3-5 percent in the quarter, but the average selling price to be flat to up 3 percent.


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Monday, December 18, 2017