Russel's Sales, Income Spike in Q1
By Metal Center News Staff
on May 5, 2021
Russel Metals reported sales of $885 million in the first quarter, a substantial increase over both the prior quarter and the first quarter of 2020. First-quarter sales were up 31.9 percent from the fourth quarter and an increase of 7.9 percent from the same time last year.
Net income grew even more. The company’s net income in the quarter totaled $81 million, compared to a loss of $9 million in the fourth quarter and $11 million in income during Q1 of 2020.
Each of the company’s segments generated a substantial improvement in operating profit for the first quarter of 2021 versus the fourth quarter of 2020. The metals service centers segment generated a record operating profit as a result of strong market conditions, the transactional approach to our business model and the impact from its value-added processing initiatives.
The steel distributors segment generated an improvement in operating profit for the quarter due to favorable conditions that allowed our U.S. business, in particular, to benefit from market opportunities.
Finally, the energy segment generated an improvement in operating profit as a result of recent initiatives that were focused on repositioning the segment and reducing the capital employed in OCTG and line pipe.
In the metals service center and steel distributors segments, the company anticipates the near-to-medium term market conditions to remain strong. Demand is expected to grow across a range of North American end markets. At the same time, product availability remains constrained in the supply chain. The result is expected to be a favorable operating environment in the second quarter for the company’s metals service centers and steel distributors segments, executives said.
In the energy segment, Russel typically experiences a seasonal slowdown in Canada during the second quarter due to spring break-up conditions. However, the company expects a general rebound of energy activity in the second half of 2021, as the sector recovers from the lows experienced in 2020.