Earle M. Jorgensen Co. (EMJ) reported net income of $26.7 million on sales of $389.3 million for the second fiscal quarter, and net income of #48.6 million on revenues of $750.9 million for the first six months ended September 29, 2004.

Second Quarter Results— Net income for the second quarter of fiscal 2005 was $26.7 million versus $1.3 million for the same period in fiscal 2004. The fiscal 2005 second quarter financial results include a charge to inventory to record results on a last in first out basis (LIFO) of $13.0 million.

Operating income increased 240.7% to $47.7 million compared to $14.0 million for the same period in fiscal 2004. Revenues, $389.3 million, represent a 68.4% increase compared to $231.2 million and $14.0 million, respectively, for the same period in fiscal 2004. Tonnage shipped increased approximately 28.2% from the prior year quarter.

Six Month Results—Net income, $48.6 million, compares to $4.0 million for the same period in fiscal 2004. The fiscal 2005 year-to-date financial results include a LIFO charge of $24.4 million.

Revenues increased 59.9% to $750.9 million when compared to $469.5 million for the same period in fiscal 2004. Operating income increased 189.4% to $87.4 million for fiscal 2005 compared to $30.2 million in the same period in fiscal 2004. Tonnage shipped increased by approximately 27.9% from the same period in fiscal 2004.

Comments—Maurice S. Nelson Jr., EMJ's President and CEO stated, "We are very pleased with our strong second quarter results, which followed an exceptional first quarter. We continue to experience price increases from our raw material suppliers and have managed to adjust our prices as these increases occur. Gross margins for the second quarter fiscal 2005 were 28.4%, compared to 27.8% for the second quarter of fiscal 2004 and 29.2% in the first quarter of fiscal 2005. Our net margin of 6.9% for the quarter and 6.5% for the first six months are the best in the company's history and demonstrate that the company has both grown its revenues and effectively managed its expenses during the industry rebound.

"The growth we experienced in the second quarter is unusual in that historically the second quarter is seasonally slow due to customers' summer shut downs.

"During the quarter we completed the relocation to a replacement facility in Houston, Texas. Additionally, the new branch in Birmingham, Alabama and the satellite facility in North Bay, Ontario became operational during the quarter, along with the expansion of our Wrightsville, Pennsylvania facility."

With 36 service and processing centers, EMJ is one of the largest distributors of metal products in North America. EMJ inventories more than 25,000 different bar, tubing, plate, and various other metal products, specializing in cold finished carbon and alloy bars, mechanical tubing, stainless bars and shapes, aluminum bars, shapes and tubes, and hot-rolled carbon and alloy bars.