Russel's Sales, Earnings Dip in Third Quarter
By Metal Center News Staff
on Nov 7, 2019
Russel Metals, Mississauga, Ontario, reported net income of $18 million in the third quarter, a sharp decline from the $68 million posted in the same quarter of 2018. Net income in the prior quarter was $31 million.
Net sales during the quarter totaled $869 million, a 23.8 percent decline from second-quarter 2018. Net sales were similar to the prior quarter.
For the year to date, net income was down more than 50 percent to $83 million. Year-to-date net sales of $2.8 billion were down 7 percent.
"The cyclical nature of our business was evident this quarter with all three business segments experiencing challenging conditions. Hot-rolled coil pricing is currently at levels last experienced in 2016," said John G. Reid, president and CEO.
The revenue decline was across the board in Russel’s three business segments. Revenues in the company’s metals service centers decreased 15 percent to $474 million for the quarter compared with the same period in 2018. Same-store tons shipped in the third quarter were approximately 5 percent lower.
Revenues in Russel’s energy products segment decreased 36 percent to $298 million due to reduced year-over-year North American rig counts and a large line pipe shipment included in 2018 revenues not replicated in 2019.
Revenues in the steel distributors segment in the quarter decreased 18 percent to $94 million.
During the quarter, Russel completed the acquisition of City Pipe & Supply Co., and increased its value-added capabilities in its service center operations.
“City Pipe strengthens our footprint in the Permian Basin and dovetails nicely with our existing operations in Oklahoma, Texas and North Dakota through our Apex Remington energy field stores,” Reid said.