Universal Stainless Reports 1st Quarter Results
04/22/2004 -
| Return to Steel News Headlines| Print This Page |
Universal Stainless
Reports
1st Quarter Results
April 22, 2004 — Universal Stainless & Alloy Products, Inc. reported first quarter net income of $227,000 on sales of $21.3 million.
In the first quarter of 2004, the Universal Stainless & Alloy Products segment had sales of $18.8 million and operating income of $401,000. This compares with sales of $12.4 million and an operating loss of $774,000 reported in the first quarter of 2003. The improvement reflected substantial increases in sales to forgers, service centers, OEMs and of reroll product to Dunkirk both sequentially and year over year. The Dunkirk Specialty Steel segment reported record sales of $6.7 million and operating income of $34,000. This compares with sales of $4.8 million and an operating loss of $599,000 in the same period of 2003. Dunkirk's turnaround reflected an increase in profitable sales to wire redrawers, service centers and OEMs. |
The $227,000 net income ($0.04 per diluted share) compares to a net loss of $583,000 ($0.09 per diluted share) for the first quarter of 2003. Sales, $21.3 million, compare to sales of $14.7 million in the first quarter of 2003 — a 45% increase. Revenues for the current quarter are at the highest level since 2002.
Commenting on the results, President and CEO Mac McAninch stated: "Our first quarter results clearly indicate that we are on the road to recovery. This was our strongest quarter in the last six, and we returned to profitability company-wide. Most importantly, we are pleased to report that Dunkirk has broken through the profitability barrier."
Mr. McAninch continued: "Our total sales to forgers, OEMs and service centers increased 132%, 84% and 43%, respectively, over the first quarter of 2003, and 41%, 51% and 45% over the previous quarter. In fact, we saw strong growth in nearly every customer category compared to those prior periods. The significant growth in the 2004 first quarter was mainly driven by strong shipments of aerospace, power generation and tool steel products."
Mr. McAninch concluded: "We are entering the second quarter with a large backlog, driven by the growing momentum of economic recovery in the U.S. This momentum, combined with raw material surcharges and our recent price increases, has enhanced our ability to offer a wider range of cost-competitive products at Dunkirk Specialty Steel and will allow us to achieve further profitable growth company-wide in coming quarters."
Business Outlook—The company estimates that second quarter 2004 sales will range from $25 to $29 million and that diluted EPS will range from $0.15 to $0.20. In the second quarter of 2003, sales were $16.8 million and the company incurred a net loss per diluted share of $0.07.
| Visit steelnews.com's Universal Stainless page or Stainless & Specialty Steel page for additional background. |
Universal’s estimates are based on its total backlog at March 31, 2004 of approximated $37 million, which compares to $21 million at December 31, 2003. Second quarter results will benefit from enhancements to the raw material surcharge mechanism and other price increases previously implemented. In addition, sales from the Dunkirk Specialty Steel segment are expected to approximate $8 million, which will allow further reductions in the manufacturing cost of products sold.
Headquartered in Bridgeville, Pa., Universal Stainless & Alloy Products, Inc. manufactures and markets a broad line of semi-finished and finished specialty steels, including stainless steel, tool steel and certain other alloyed steels. The company's products are sold to original equipment manufacturers, service centers, forgers, rerollers and wire redrawers.
