Pricing: Average ferrous and nonferrous prices decreased 3% and 9%, respectively, compared to prices in the first quarter of fiscal 2012. Despite improved export demand during the quarter, the market disruption experienced in the first quarter, caused mainly by an escalation in the European financial crisis, resulted in a sharp decline in sales prices that impacted shipments during the beginning of the second quarter. In addition, mild winter conditions during the quarter generated softness in selling prices toward the end of the quarter.
Margins: Operating income per ferrous ton was $15 in the second quarter of fiscal 2012, an increase of 39% compared to $11 per ton in the first quarter fiscal 2012. While performance improved during the quarter, operating margins remained compressed due to weak market conditions and tight availability of supply.
Auto Parts Business
Our Auto Parts Business delivered steady volumes and lower revenues in the second quarter of fiscal 2012 as compared to the prior quarter. Weak market conditions led to a further decline in commodities pricing which, together with the tight supply conditions, resulted in operating margins of 11%.
|Summary of Auto Parts Business Results|
|($ in millions, except locations)|
|Car Purchase Volumes (000)||84||85||(1||)%||81|
|Locations (end of quarter)||51||50||2||%||50|
|* Excludes results from discontinued operations|
|Summary of Steel Manufacturing Business Results|
|($ in millions, except selling prices; volume in thousands of tons)|
|Operating Income (Loss)||$||(1||)||$||1||NM||$||(1||)|
|Avg. Net Sales Prices ($/NT)||$||725||$||722||—||%||$||687|
|Finished Goods Sales Volumes||112||107||5||%||99|
|NM = Not Meaningful|
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