Feb. 1, 2006 — California Steel Industries, Inc. reported net income of $12.7 million on sales of $300.8 million for the quarter, and net income of $43.4 million on sales of $1.23 billion for the year ended December 31, 2005.

Fourth Quarter Results—The $12.7 million net income compares to net income of 35.1 million for the fourth quarter of 2004. Sales of $300.8 million compare to sales of $341.9 million for the fourth quarter of 2004. Shipments totaled 479,380 tons for the quarter.

Net sales decreased 12% from the same period a year earlier, while billed net tons were 6% higher, reflecting a decline in the average selling price of about 17%, when compared to fourth quarter 2004. EBITDA, as adjusted, was $38.0 million, a decline over 2004's $67.9 million, although substantially higher than third quarter's $6.7 million.

Full Year Results—Net income of $43.4 million compares to net income of $109.3 million for 2004. Net sales of $1.23 billion compare with net sales of 1.26 billion for 2004. Shipments for the year totaled 1.8 million tons.

Net sales were just 2% lower than in 2004, although billed net tons were 14% lower. The average sales price for the year is 14% higher than in 2004; however, sales prices fell about 17% during 2005. EBITDA, as adjusted, was $118.8 million, down from 2004's $224.0 million.

"Although 2005 presented some challenges to California Steel," said Masakazu Kurushima, President & CEO, "we finished the year on a more positive note, and are well positioned through first quarter of 2006."

Capital expenditures during 2005 total $43.0 million, which included the early buyout option of a lease held on equipment.

Liquidity continues to remain high, with a cash balance of $104.3 million. Availability under the Company's Revolving Credit Agreement was $108.5 million, with no outstanding balance.

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, electric resistant weld pipe and galvanized coil and sheet. Located in Fontana, Calif., California Steel has about 1,000 employees.

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