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
ISM: US manufacturing poised for growth in 2025
“Manufacturers are optimistic,” said Timothy R. Fiore, chair of ISM’s Manufacturing Business Survey Committee.
New York state manufacturing activity stable in December
Following a substantial recovery in November, business activity in New York state’s manufacturing sector held steady in December, according to the latest Empire State Manufacturing Survey from the Federal Reserve Bank of New York.
Ternium chief say Mexico tariffs ‘irrational’
Vedoya said the proposed tariffs are "an irrational measure that would harm both their own industry and ours."
Slowing data center, warehouse planning drives decline in Dodge index
The Dodge Momentum Index (DMI) slid further in November as planning for data centers and warehouses continued to decline.
Beige Book shows some positive economic activity
Still, many businesses noted increased sensitivity to prices and quality among customers.