Reliance Steel & Aluminum Co., Los Angeles, reported net income of $148.3 million in the third quarter, a 52.4 percent increase over the year-ago period. Net sales totaled $2.97 billion, the second highest in the company’s history and up 21.4 percent from third-quarter 2017.
“We are very pleased with our third quarter performance, which was characterized by solid pricing, continued healthy demand and excellent execution by our managers in the field,” said Gregg Mollins, president and CEO of Reliance. “Our earnings were supported by favorable pricing conditions, with prices on the majority of the products we sell remaining at high levels throughout the quarter.”
Tons sold in the quarter decreased 1.2 percent to 1.5 million, while the average selling price per ton increased 23 percent year over year.
Despite the slight decline in tons sold, Mollins said the company is encouraged by the continuing positive demand conditions across nearly all of the end markets Reliance serves.
“The decrease was due to the normal seasonal decline we experience during the summer months, which includes lower shipping volumes due to customer shutdowns and vacation schedules, as well as one less shipping day in the third quarter compared to the second quarter of 2018,” Mollins said. “Metals pricing across all of our major commodities remained positive. Our average selling price per ton sold increased 4.3 percent in the third quarter compared to the second quarter of 2018, exceeding our expectations.”
Reliance executives expect demand in the fourth quarter will remain healthy, excluding the impact of normal seasonal patterns. The company said it anticipates tons sold will decrease between 5 percent and 7 percent in the upcoming quarter.
Reliance management also believes pricing fundamentals will remain steady to slightly up
Based on current demand levels, raw material costs and ongoing trade actions, Reliance expects pricing fundamentals will remain steady to slightly up. Based on this, the company said average selling price per ton sold for the fourth quarter will be flat to up 1 percent from the third quarter.
“We continue to experience healthy activity in nearly all of the end markets in which we operate and remain confident in our ability to maximize our earnings power and maintain our focus on increasing value to our stockholders,” Mollins said.