These results compare to earnings of US$20 million or US$0.33 per share on revenues of US$758 million in the same quarter last year and first quarter earnings of US$29 million or US$0.47 per share on revenues of US$924 million.
 
Revenues in our metals service center segment increased 11% to US$419 million in the second quarter of 2014 compared to the 2013 second quarter due to stronger demand and higher steel prices.  Gross margins at metals service centers improved to 20.9% from 20.4% in the same quarter last year reflecting increased steel prices.  Operating profit as a percentage of revenues at 6.1% was up from 5.4% in the same quarter last year reflecting the improved volumes and prices in the quarter.
 
Revenues in our energy products segment for the second quarter of 2014 increased 17% to US$366 million compared to the 2013 second quarter led by significant increases in our operations servicing oil and gas drilling in Western Canada.  Gross margins in our energy products segment improved from both the 2014 first quarter and the 2013 second quarter to 18.6% from 17.0% and 15.9% respectively primarily due to product mix.  Operating profit as a percentage of revenues was 7.4% compared to 5.4% in the same quarter of 2013.  Strong oil and gas prices have led to increased drilling activity in the energy products segment during 2014.
 
Apex Distribution and Apex Monarch, its recent acquisitions in the energy products segment, both experienced stronger than expected results in the 2014 first half and we expensed an additional US$2 million to provide for an increase in the potential future payments for these acquisitions under our contractual earnout obligations.
 
Revenues in our steel distributors segment increased by 63% to US$106 million in the 2014 second quarter compared to the 2013 second quarter due to stronger demand and higher pricing.  Operating profits for the second quarter of 2014 increased to US$9.0 million from US$5.0 million for the 2013 second quarter.
 
Brian R. Hedges, president and CEO, commented "Our revenues, gross margins and operating profits improved in all three of our business segments versus last year.  We have benefited from the strengthening economy in the United States and Western Canada.  Our investments over the last three years in acquisitions, process improvements, new facilities and processing equipment have allowed us to strengthen and grow our market share.  Both our return on net assets and return on equity have improved validating our internally focused business model.  This quarter we were able to increase our dividend 9% to US$0.38 per share and distribute a larger portion of the earnings we have achieved to our shareholders."
 
Mr. Hedges further commented, "In addition, during the quarter we continued our evaluation of an ERP software solution, a project that was previously announced in February this year.  The analysis we are undertaking has been very valuable and has resulted in a detailed definition of our needs and ERP system requirements.  We have expensed our total costs to date of US$2 million on the project and expect to complete the evaluation during the second half of 2014."
 

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Russel Metals is one of the largest metals distribution companies in North America.  It carries on business in three metals distribution segments: metals service centers, energy products and steel distributors, under various names including Russel Metals, A.J. Forsyth, Acier Leroux, Acier Loubier, Alberta Industrial Metals, Apex Distribution, Apex Monarch, Apex Remington, Arrow Steel Processors, B&T Steel, Baldwin International, Comco Pipe and Supply, Fedmet Tubulars, JMS Russel Metals, Leroux Steel, McCabe Steel, Mégantic Métal, Métaux Russel, Métaux Russel Produits Spécialisés, Milspec, Norton Metals, Pioneer Pipe, Russel Metals Specialty Products, Russel Metals Williams Bahcall, Siemens Laserworks, Spartan Energy Tubulars, Sunbelt Group, Triumph Tubular & Supply, Wirth Steel and York-Ennis.