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California Steel Reports Profitable 3rd Quarter
10/29/2009 - California Steel reports net income of $7.4 million on net sales of $147 million for the third quarter and a net loss of $10.8 million on net sales of $398.2 million for the nine months ended September 30, 2009.
California Steel Industries, Inc. reported net income of $7.4 million on net sales of $147 million for the third quarter, and a net loss of $10.8 million on net sales of $398.2 million for the nine months ended September 30, 2009.
Third Quarter Results — The $7.4 million net income compares to a net loss of $2.8 million in the previous quarter, and net income of $35.55 million in the year-ago third quarter.
Net sales of $147 million compare to net sales of $104.2 million in the previous quarter and net sales of $440.8 million in the year-ago third quarter.
Shipment levels at 244,417 net tons represent a 38% improvement from the previous quarter and a 31% decrease vs. the year-ago third quarter. The average selling price for all product line, while consistent with the previous quarter, was 50% lower than the year-ago third quarter.
EBITDA (as adjusted) for the quarter is $20.2 million, more than twice that of second quarter 2009, while off almost 70 percent from third quarter 2008.
Year-to-Date Results — The $10.8 million net loss for the first nine months compares to net income of $89.4 million in the comparable year-ago period. Net sales of $398.2 million are 68% lower than net sales of $1.24 billion in the first nine months of 2008.
Shipments for the first nine months are 578,133 net tons, compared with 1,249,743 net tons in 2008. Year to date, the average selling price is down 30% from 2008.
Management Comments — "Under these circumstances of low production and shipment levels, I am pleased to report a profit for the quarter," said Vicente Wright, President & CEO.
"The improved level of shipments was certainly welcome, and was a key contributor, along with slightly better sales prices and our company's constant dedication to cost management, to place CSI back to profitability in the third quarter," he continued.
The company continues its strong liquidity position, with a balance of cash and cash equivalents as of September 30, 2009 of $96.8 million. As of September 30, 2009, the company has no outstanding balance under its Revolving Credit Agreement and availability of more than $108 million.
California Steel Industries is the leading producer of flat rolled steel products in the western United States (the 11 states located west of the Rocky Mountains) based on tonnage billed, with a broad range of products, including hot rolled, cold rolled and galvanized coil and sheet. The company also produces electric resistant weld pipe. Located near Fontana, Calif., California Steel has about 900 employees.
