Economy
Schnitzer Q3 Earnings Lifted Sequentially by Scrap Demand
June 27, 2023
Schnitzer Steel Industries reported lower earnings in its fiscal third quarter ended May 31 vs. a year earlier, but sequential performance was higher, driven by stronger demand for recycled metals.
The Portland, Ore.-based scrap recycler and long steel producer reported net income attributable to shareholders of $13.5 million in its fiscal Q3, down 82% from $74.6 million in the same period last year on revenues that slid 20% to $809.6 million. However, this is up from net income of $4.4 million on revenues of $756 million in the same comparison with Q2.
Sequentially, average net selling prices for ferrous and nonferrous products increased 13% and 2%, respectively, Schnitzer said.
The company said that sales volumes for finished steel products increased 30% to 142,000 net tons in its Q3 compared with Q2, benefiting from seasonally stronger demand for finished steel. Rolling mill utilization reached 97% in the quarter vs. 75% in the previous quarter and 96% a year earlier. Schnitzer added that average net selling prices for finished steel were lower sequentially by 2% in its Q3.
Tamara Lundgren, Schnitzer’s chairman and CEO, was bullish on her long-term outlook.
“While the near-term economic environment is showing some signs of slowdown, the long-term structural demand for recycled metals remains positive,” she said in a statement on Tuesday.
She said this is supported by (1) increased focus on decarbonization, (2) the transition to low-carbon technologies, (3) and the anticipated demand associated with the Infrastructure Investment and Jobs Act and the Inflation Reduction Act, including Buy Clean provisions.
By Ethan Bernard, ethan@steelmarketupdate.com
Latest in Economy
January energy market update
In this Premium analysis we cover North American oil and natural gas prices, drilling rig activity, and crude oil stock levels. Trends in energy prices and active rig counts are leading demand indicators for oil country tubular goods (OCTG), line pipe and other steel products.
New York state manufacturing fell in January
“Price increases, while subdued, picked up,” Richard Deitz, Economic Research Advisor at the New York Fed. “Firms grew more optimistic that conditions would improve in the months ahead.”
Beige Book shows mixed economic trends, manufacturing challenges, tariff concerns
Economic activity across the US experienced slight to moderate growth at the end of 2024, while manufacturing activity showed a slight decline
Contractors concerned about tariffs, immigration in 2025: AGC survey
AGC said Trump should be “sparing” in imposing new tariffs and exclude products needed for domestic manufacturing, energy and infrastructure.
Dodge Momentum rebounds in December
Improved growth in data center planning and warehousing projects helped the Dodge Momentum Index (DMI) rebound in December.