A.M. Castle Upbeat Despite 2010 Loss
A.M. Castle & Co., Franklin Park, Ill., reported a net loss of $1.5 million in the fourth quarter, contributing to a losing year for the specialty metals distributor. Castle reported a net loss of $5.6 million for full-year 2010, an improvement on the $26.9 million loss the previous year.
Castle’s net sales for the quarter totaled $235.6 million, up 30 percent from the $181.3 million posted during the same period in 2009. Net sales for the full year totaled $943.7 million, 16.1 percent better than the previous year.
“Sales activity during the fourth quarter of 2010 was stronger than we had anticipated due to increased demand in several of our key end markets. In addition, the pricing and gross profit margin environment improved during the fourth quarter compared to the third quarter of 2010,” said Michael Goldberg, president and CEO, during the company’s quarterly conference call with investors and analysts.
For the quarter, sales in the company’s Metals segment totaled $210.0 million, 31.8 percent higher than 2009. Metals segment tons sold per day for the fourth quarter were flat sequentially from the third quarter, but were up 27.8 percent from the previous year.
For the full-year 2010, Metals segment sales of $841.1 million were 15.8 percent higher than in 2009, while tons sold per day increased 14.8 percent.
“A typical seasonal pattern in our business would result in lower fourth-quarter tons sold compared to the third quarter. But this year our tons sold stayed even in the fourth quarter, demonstrating the continued recovery in several of our key markets such as oil and gas, mining and heavy equipment, and general industrial products,” Goldberg said.
The company’s emphasis on working capital management resulted in a $30.9 million inventory reduction and an $18.4 million debt reduction from third-quarter levels. For the full-year, the company achieved $40 million in inventory and $20 million in debt reductions from 2009 levels.
“Our performance in 2010 exceeded our internal goals for operating results and our key initiatives, and we look forward to 2011 with renewed optimism. The company’s balance sheet is strong, there is solid liquidity, and we believe that our overall sales growth rate in 2011 will be similar to what we achieved in 2010,” said Goldberg.