Metals USA Reports Q2 Sales and Volume Growth
07/26/2011 - Metals USA Holdings Corp. reported net sales for the second quarter of 2011, ended June 30, 2011, of $505.6 million, up 51% from a year ago. Net income for the second quarter was $21.5 million compared to $2.5 million for the same period in 2010.
Metals USA Holdings Corp. reported net sales for the second quarter of 2011, ended June 30, 2011, of $505.6 million, up 51% from net sales of $335.0 million for the second quarter of 2010. Net income for the second quarter of 2011 was $21.5 million compared to net income of $2.5 million for the same period in 2010. Earnings per diluted share (EPS) were $0.57 in the second quarter of 2011 vs. $0.07 for Q2 2010.
Net sales for the first six months of 2011 were $937.9 million, also up 51% from net sales of $622.9 million for the same period in 2010. Net income for the first six months was $33.9 million compared to net income of $2.6 million for the six months ended June 30, 2010. EPS was $0.91 compared to $0.09 for the year-ago six-month period.
Metal shipments were 360,000 tons for Q2 2011, a 33% increase from metal shipments of 270,000 tons in the second quarter of 2010. Metal shipments for the first six months were 728,000 tons, up 40% compared to metal shipments of 519,000 tons for the first six months of 2010. Toll processed tonnage was 42,000 tons during the second quarter compared to 11,000 tons a year ago; it was 87,000 tons during the first six months of 2011 compared to 21,000 tons for the same period in 2010.
Lourenco Goncalves, the company's Chairman, President and CEO, said: "Metals USA's results continue to benefit from an improving demand for our products and services, as the total market size increases with the uneven recovery of the U.S. economy, and as we continue to grow Metals USA's market share. As we anticipated and stated during our first quarter conference call, our Flat Rolled and Non-Ferrous Group experienced an increase in gross margins during the second quarter, as higher prices were realized in our multi-month indexed pricing contracts. Conversely, our Plates and Shapes Group experienced slightly compressed gross margins due to the more transactional nature of its business, but the effect was more than offset by overall stronger prices during the quarter.
"A favorable steel price environment in the third quarter, supported by higher prices for iron ore, coking coal and scrap, should translate into strong margins for our business,” Goncalves added. “We believe that the size and quality of our inventory are appropriate, and will allow Metals USA to continue to deliver solid results in the third quarter."
Adjusted EBITDA was $50.0 million for the second quarter of 2011, up 95% from the company's Adjusted EBITDA of $25.7 million for Q2 2010. For the first six months of 2011, Adjusted EBITDA was $87.3 million compared to $43.9 million for the same period of 2010.
Metals USA had $240.1 million drawn under its asset-based credit facility at June 30, 2011, with excess availability of $163.5 million. Net debt, defined as total outstanding debt less cash, decreased by $1.1 million during the quarter to $468.4 million as of June 30, 2011. Net cash used in operating activities for second quarter of 2011 was $43.8 million. Capital expenditures were $1.7 million for the three months ended June 30, 2011, and $3.7 million for the first six months of 2011.
Metals USA provides a wide range of products and services in the heavy carbon steel, flat-rolled steel, non-ferrous metals, and building products markets.
