Worthington Industries, Inc. reported net earnings of $33.1 million on net sales of $747.4 million for third quarter, and net earnings of $138.6 million on net sales of $2,261.9 million for the nine-month period ended February 28, 2005.

Third Quarter Results—Net earnings of $33.1 million ($0.37 earnings per diluted share) represent a 35% increase compared to net earnings of $24.5 million ($0.28 per diluted share) for the same period last year. Net earnings were reduced by $4.3 million ($0.05 per diluted share) due to a one-time state tax adjustment recorded in the current quarter. In January 2005, the Sixth Circuit Court of Appeals held the state of Ohio's investment tax credit program unconstitutional.

Net sales of $747.4 million reflect an increase of 34% from last year's $558.1 million.

Nine-Month Results—Net earnings of $138.6 million ($1.57 per diluted share) compare to $47.3 million ($0.55 per diluted share) for the same period last year. Year-to-date results include the unfavorable impact of charges related to the sale of certain Decatur, Ala., assets that reduced net earnings by $3.5 million ($0.04 per diluted share). Year-to-date results from the prior year include the favorable impact of a gain on the sale of certain Metal Framing assets that increased net earnings by $2.5 million ($0.03 per diluted share).

Net sales rose 42% to $2,261.9 million from $1,596.2 million last year.

Management Comments—"I am pleased to report record third quarter earnings," said John McConnell, Chairman and CEO of Worthington Industries. "All three of our business segments and our joint ventures reported significant increases in sales and operating income over last year's quarter.

"Looking to our fourth quarter, historically our strongest from a seasonal demand standpoint, we see continued momentum in the markets we serve and in both the U.S. and global economies. Commercial construction activity has been gaining strength. As a result, excess inventories in the metal framing industry, which resulted from a combination of purchasing in front of price increases and weather related postponement of construction starts, are shrinking. Pressure Cylinders produced strong third quarter earnings during what historically is a seasonally weaker period. While stronger than expected sales of refrigerant and high pressure cylinders played a role in the increase, several new products demonstrated an ability to drive results. Our expansion into smaller cylinders and air tanks for truck braking systems, and our increased marketing efforts with helium cylinders, all produced good results and the potential for future increases.

"I am extremely proud of our people and what they have accomplished. Our past and ongoing efforts to reduce operating costs and increase efficiency have placed us in an excellent position for the years ahead. Our people are continuing to demonstrate tremendous loyalty and dedication as we simultaneously work our way through the cost of assuring Sarbanes-Oxley compliance and the implementation of our new enterprise resource planning (ERP) system. Both require a tremendous commitment of time and money. We expect the ERP system to contribute to future earnings as the expense recedes and the benefits begin," concluded McConnell.

Segment Results—Quarterly net sales rose 34% ($109.9 million) to $435.7 million for the Processed Steel Products segment from $325.8 million in the comparable quarter of fiscal 2004. The increase was the result of a 47% increase in selling prices. Volumes were down 9% due to the sale of the Decatur cold rolling assets in August 2004; excluding the impact of the Decatur sale, volumes were flat. Operating income improved because of a wider spread between selling prices and material costs and lower expenses due to the sale of the Decatur cold mill.

In the Metal Framing segment, net sales increased 32% ($47.6 million) to $194.6 million from $147.0 million in the comparable quarter of fiscal 2004. The increase resulted from a 59% increase in pricing. Unit volume was down 17%, primarily as a result of higher customer inventories due to buying earlier in the year combined with weather related job postponements. A wider spread between selling prices and material costs was responsible for a significant improvement in operating income. Operating income for the prior year included a $3.9 million pre-tax gain on the sale of certain assets acquired in the Unimast acquisition.

In the Pressure Cylinders segment, net sales increased 38% ($30.9 million) to $112.3 million from $81.4 million in the comparable quarter of fiscal 2004. The propane and specialty cylinder assets of Western Industries, acquired on September 17, 2004, contributed $15.8 million to the sales increase. Excluding sales from the acquired assets, unit volumes were up 9% due to strong sales in most product lines. European revenue rose $6.5 million, largely on the successful ramp-up of air tank volume and strong demand for high pressure cylinders and a $2.0 million increase due to the weakened dollar. The acquisition and improved European results led to an operating income improvement for the segment of $2.5 million.

Worthington's unconsolidated joint ventures continued to perform well. Equity in net income of the seven unconsolidated affiliates totaled $14.8 million, up 78% from $8.3 million in the year-ago quarter. The $6.5 million equity income improvement was due to strong results from most of the unconsolidated joint ventures.

Worthington Industries is a leading diversified metal processing company with annual sales of more than $2 billion. The Columbus, Ohio, based company is a premier value-added steel processor and a leader in manufactured metal products such as metal framing, pressure cylinders, automotive past model service stampings, metal ceiling grid systems and laser welded blanks. Worthington employs more than 8000 people and operates 63 facilities in 10 countries.

Founded in 1955, the company operates under a long-standing corporate philosophy rooted in the golden rule, with earning money for its shareholders as the first corporate goal. This philosophy, an unwavering commitment to the customer, and one of the strongest employee/employer partnerships in American industry serve as the company's foundation.