Globe Specialty Metals Announces First Quarter Fiscal 2011 Results

NEW YORK, Nov. 10, 2010 (GLOBE NEWSWIRE) -- Globe Specialty Metals, Inc. (Nasdaq:GSM) (the "Company") today announces results for the quarter ended September 30, 2010. Key points are as follows:

• Net sales for the quarter of $137.4 million were up 30% and shipments of 58,448 MT were up 46% from the first quarter of last year. We achieved these volumes despite significant planned maintenance outages in the quarter. However, as expected from the planned outages, both sales and shipments were off a modest 6% from the immediately preceding quarter ended June 30, 2010.  
• Net income attributable to GSM for the quarter was $2.2 million, compared to $6.6 million in the quarter ended June 30, 2010 and $8.4 million in the first quarter of last year. Diluted earnings per share were $0.03 for the quarter, compared to $0.09 per share in the quarter ended June 30, 2010 and $0.12 per share in first quarter of last year. Diluted earnings per share on a comparable basis, as noted in the table below, were $0.08 per share in the first quarter, $0.11 per share in the quarter ended June 30, 2010 and $0.12 per share in the first quarter of last year.  
• Customer demand continues to grow with the major silicone and polysilicon producers recently announcing increased calendar third quarter sales. All of our silicon metal and silicon-based alloy furnaces are running at full capacity, subject to planned maintenance outages. 

• Our silicon metal average selling price increased by 2% from the quarter ended June 30, 2010 primarily as a result of increasing spot pricing on the small volume of shipments not under long-term or annual fixed-price contracts. Our silicon-based alloy average selling price remained virtually unchanged.     
• Our Niagara Falls plant is now operating at expected levels. During the quarter ended September 30, 2010, we had planned maintenance outages for each of the two furnaces for a full month to complete needed repairs and upgrades. Also, during the quarter we had planned maintenance outages at our Alloy, WV and Selma, AL plants, with each plant having one furnace out of service for approximately one month. As a result, most of our planned maintenance for fiscal 2011 is now behind us.   
• We paid an annual dividend of $0.15 per common share on October 29, 2010. This dividend represents an aggregate cash payment of $11.3 million to our stockholders. We believe our expected future free cash flow, modest debt levels and net cash balance were sufficient to fund a dividend of this amount and provide adequate financial flexibility to support our growth initiatives. In the future, we intend to continue to consider declaring dividends on an annual basis, subject to reviewing our earnings, liquidity and business outlook.            

Diluted earnings per share on a comparable basis were as follows:

	FY 2011	FY 2010
	First Quarter	Fourth Quarter	First Quarter
Reported Diluted EPS	$ 0.03	0.09	0.12
Tax rate adjustment	0.02	(0.03)	--
Loss on sale of business	--	0.04	--
Niagara Falls and Selma start-up costs	0.03	0.02	--
Transaction expenses	--	--	--
Restructuring charges	--	--	--
Power adjustment	--	(0.01)	--
Diluted EPS, excluding above items	$ 0.08	0.11	0.12

First quarter results were negatively impacted by $1.4 million of book tax expense related to a discrete item recorded in the quarter and $2.0 million of after-tax start-up costs for the Niagara Falls, NY plant. The Niagara Falls plant is operating as expected, and we do not anticipate any further start-up costs. The decrease in diluted EPS, excluding the above items, from $0.11 per share in the fourth quarter of fiscal 2010 to $0.08 per share in the first quarter of fiscal 2011, was expected and is primarily due to the decrease in production and shipments caused by the planned maintenance outages.