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Lakeside Steel Reports Q2 Results

11/04/2010 - For the three months ended September 30, 2010, Lakeside Steel Inc. reported revenue of $66,485,859, a 273% increase compared to $17,812,672 for the same period in 2009, and an increase of $4,282,994, or 7%, compared to the previous quarter ended June 30, 2010.

For the three months ended September 30, 2010, Lakeside Steel Inc. reported revenue of $66,485,859, an increase of $48,673,187, or 273%, compared to $17,812,672 for the same period in 2009, and an increase of $4,282,994, or 7%, compared to the previous quarter ended June 30, 2010.
 
For the six months ended September 30, 2010, the company’s revenue was $128,688,724, an increase of $94,876,663, or 281%, compared to $33,812,061 a year ago.
 
The company’s Q2 net income was $1,614,298, an increase of $4,635,868 from a net loss of $3,021,570 for the three months ended September 30, 2009, and an increase of $1,401,344 compared to the previous quarter. For the six months ended September 30, 2010, the company’s net income was $1,827,252, an increase of $7,836,987 compared to a net loss of $6,009,735 for the same period last year.
 
Lakeside Steel’s adjusted EBITDA was $3,483,626, an increase of $7,961,216 from an adjusted EBITDA of $(4,477,590) last year and an increase of $2,418,699 compared to the previous quarter. For the six months, the company’s adjusted EBITDA was $4,548,553, an increase of $12,626,093 compared to adjusted EBITDA of $(8,077,540) for the six months in 2009.
 
The company had earnings per share of $0.02 for the second quarter, compared to last year’s loss per share of $0.05.
 
As previously reported, the demand in the oil and gas sector for the oil country tubular goods manufactured by Lakeside Steel Corp., a wholly-owned subsidiary, experienced a positive increase in the third and fourth quarters of fiscal 2010. This continued into the first half of fiscal 2011. The company notes that there has been an increase of imported tube and pipe entering North America in recent months; it expects a reduction in demand toward the end of the quarter as customers adjust inventories for year end.
 
Ron Bedard, President and CEO of Lakeside, said: “The company is pleased with its second quarter results: $66.4 million represents the highest quarterly revenue in company history. The company continues to make the changes necessary to ensure that Welland can consistently make a profit, including the recently announced SG&A reduction program and the increased end finishing production capacity. Both of these undertakings are expected to have a positive impact on the company’s bottom line.
 
“The company will continue to focus on cost-reduction programs and margin-enhancement opportunities. The company is also continuing activities to remove the Welland environmental liability, which has been reduced by 20% to date through payments from cash flow. The affected material is expected to be removed from the Welland site by December 31, 2010. The construction of the company’s new operating facility in Alabama is progressing on schedule and on budget.”
 
Lakeside Steel, located in Welland, Ontario, is a diversified steel pipe and tubing manufacturer. Its list of customers includes large oil and gas, mining, automotive, and commercial and industrial supply companies. Lakeside also manufactures pipe and mechanical tubing for the resale market, which is sold to distributors in Eastern Canada and the Northeastern United States. The company manufactures a variety of products for these industries including oil well tubing and casing, mechanical tubing, pressure tubing, automotive tubing, hollows for redraw, line pipe, heating and plumbing pipe, drill rod, and specialty tubing.