Olympic Steel enjoyed a highly profitable quarter, reporting net income of $22 million in the first three months of 2021. The Cleveland-based service center had reported net income of $600,000 in the same quarter last year.
The income gains were driven by record sales of $463 million in the first quarter, a 30.7 percent increase from Q1 2020.
“The strong momentum as we closed out 2020 continued in the first quarter of 2021. Favorable market conditions and record-high metals pricing, along with the disciplines we reinforced in 2020 to reduce operating expenses and improve inventory management, combined to deliver record financial performance,” said Richard T. Marabito, CEO.
In its flat-rolled segment, Olympic’s net sales were up 21.3 percent to $246.4 million, though tons sold were down 9 percent to 239,848. The story was the same in its specialty flat products, with net sales up 42.8 percent to $126.3 million, while tons sold increased only 21.1 percent.
Net sales in the company’s tubular and pipe products totaled $90.4 million, a 43.7 percent increase compared to the same quarter in 2020.
“All of our segments reported robust growth in profitability as strong demand from our end markets, combined with extended lead times to source metal, resulted in historic low inventories throughout the metals supply chain. We will continue to rely on our long-standing mill supply relationships and our strong cash conversion cycle disciplines to support our customers through this supply-constrained environment, Marabito said.
Looking ahead, Olympic executives believe the strong start to 2021 will be a harbinger of the year to come. “We are optimistic that we are in the early stages of a positive demand cycle, and Olympic Steel is in excellent position to benefit from a strengthening economy and the anticipated U.S. infrastructure build,” he said.