Ryerson Holding Corp., Chicago, reported net sales of $1.1 billion in the third quarter, an 11.6 percent decline compared with the same quarter in 2018. The company’s average selling price fell 8.1 percent and tons shipped were down 3.9 percent, driving the decline.
Revenues in the first nine months were $3.54 billion, an increase of 9 percent compared with the first three quarters of 2018, as tons shipped increased 8.8 percent on relatively flat average selling prices. On a same-store basis, revenues were $3.08, with average selling prices up 2 percent, partially offset by a decrease in tons shipped of 1.6 percent.
The company’s net income in the third quarter totaled $10.1 million, a significant decline from the $77.5 million posted in the same quarter the prior year. Net income through three quarters was down 46.9 percent to $56 million.
“The quarter was characterized by protracted and deepening industrial metals deflation, particularly across the carbon steel spectrum, as well as recessed manufacturing demand consistent with reported macro indicators such as the 47.8 Purchasing Managers Index printed in September,” said Eddie Lehner, president and CEO. “Although the road of getting average costs in inventory below replacement cost has been a long and winding one, after five quarters of steep carbon price deflation we believe the industry is transitioning to improved pricing fundamentals as well as better adjusting inventory levels to current and anticipated demand.”
Ryerson continued to gain market share on a same-store basis during the third quarter compared with the third quarter of 2018, as North American industry volume contracted 6.6 percent according to the MSCI while Ryerson North American tons shipped, excluding its Central Steel & Wire acquisition, increased by 0.5 percent.
For the fourth quarter, Ryerson anticipates tons shipped to decline 6-9 percent compared with the third quarter due to normal seasonality patterns compounded by slowing industrial growth and trade uncertainty. Executives expect carbon prices to bottom in the fourth quarter and aluminum prices to be neutral to modestly lower. Despite a recent pull-back in nickel prices, stainless prices are expected to remain supported by low warehouse and stock inventories as reported by the LME, secular demand expectations in the electric-vehicle battery market and export restraints on Indonesian nickel ore.