Reliance Steel & Aluminum Reports July Results
08/27/2009 - Reliance Steel & Aluminum reports sales of $401.9 million for July on 3% lower tons sold per day from June levels.
Reliance Steel & Aluminum Co. reported sales of $401.9 million for July, down 2.5% from June. Tons sold per day declined 3% in July from June levels.
“Our July results were in line with our expectations that demand may continue to soften somewhat but that our gross profit margins would improve,” said Reliance’s Chairman of the Board and CEO, David H. Hannah.
The company’s July FIFO gross profit increased to 21.4% of sales from 19.1% in June and 16.7% for the 2009 second quarter. FIFO inventory levels decreased $52 million in July from June 30, 2009.
“Because of our significant inventory reductions over the past several months in the face of rapidly falling demand and pricing, our inventory costs on hand are now more in line with current replacement costs, allowing us to improve our gross profit margins from the historically low margins experienced in the most recent quarter,” continued Hannah. “Also contributing to the improvement in our FIFO gross profit margin is the impact of mill price increases for many products that we sell.
“Over the past few quarters we had shifted our focus to generating cash flow to reduce our debt levels,” added Hannah, “and we were very successful, paying off over $1 billion of debt leaving no borrowings outstanding on our $1.1-billion revolving credit facility. We are now focused more on profitability and less on shipping volumes and cash flow. Our July FIFO gross profit margin was the highest monthly level we have seen so far this year,” concluded Hannah.
Headquartered in Los Angeles, Calif., Reliance Steel & Aluminum is the largest metals service center company in North America. Through a network of more than 200 locations in 38 states and Belgium, Canada, China, Mexico, Singapore, South Korea, and the United Kingdom, the company provides value-added metals processing services and distributes a full line of over 100,000 metal products to more than 125,000 customers in a broad range of industries.
