Olympic Steel profits fall 12% in Q1

The Cleveland-based service center group reported net income of $8.7 million in Q1’24, off 12% from $9.9 million a year earlier on net sales that dropped 8% to $526.6 million.

“We typically start the new in a strengthening market with increasing pricing and that trend usually continues into the second quarter,” CEO Richard T. Marabito commented in an earnings call on Friday. “However, this year, we saw index pricing for flat-rolled steel fall more than 31% from January through March, while stainless steel surcharges also fell throughout the quarter.”

Still, Marabito did note that shipping volumes were up 9% sequentially.

“Our strategy to diversify and expand our portfolio of higher-value manufactured products provides a counter-cyclical benefit to falling metal prices and helps drive profitability regardless of market conditions,” he said in a statement on Thursday.

Marabito said that all three of Olympic’s segments — carbon flat, specialty metals flat, and pipe and tube products — contributed to profitability in the quarter.

In its carbon flats segment, the company sold 219,675 short tons (st) in Q1’24, down slightly from 218,338 st in Q1’23, as net sales slipped 3% to $301 million. The average selling price per ton fell to $1,370 vs. $1,419 in the same comparison.  

Marabito said that in Q1’24, “We gained market share and expanded our offerings of fabrication and value-added products.”

Looking ahead, he says Olympic’s balance sheet remains strong, “enabling us to continue to invest strategically in organic growth, automation, and acquisition opportunities that align with our priorities for long-term success.”