OAK BROOK, Ill. (AP) â¿¿ A.M. Castle & Co. slid to a second-quarter loss as materials costs rose. The results fell far short of Wall Street expectations, and shares of the supplier of metal and plastic products tumbled more than 16 percent to the stock's lowest level in more than three years.
A.M. Castle, based in Oak Brook, Ill., on Tuesday reported a loss of nearly $3 million, or 13 cents per share, for the three months ended June 30. That compared with net income of $3.7 million, or 16 cents per share, in the same quarter a year ago.
The latest quarter's earnings were reduced by an unrealized loss due to an accounting adjustment from a debt conversion option, as well as unrealized losses on commodity hedges.
Excluding one-time items, A.M. Castle reported adjusted earnings of $2.6 million, or 11 cents per share.That was well short of the consensus forecast of analysts surveyed by FactSet, who had expected adjusted earnings of 29 cents per share. Revenue rose nearly 17 percent to $329.4 million from $282.6 million. Analysts had forecast revenue of $360.8 million, on average. A.M. Castle's biggest segment, metals, reported a nearly 18 percent revenue increase, primarily due to the company's acquisition of Tube Supply in December 2011. The company's overall revenue increase was partly offset by a 15 percent rise in materials costs to $240.7 million. The company also reported higher costs in three other expenses categories. Shares of A.M. Castle fell $1.42 to close at $7.29. That's the stock's lowest closing price since February 2009, shortly before the stock market hit bottom after the financial crisis. Shares of A.M. Castle had traded in a 52-week range of $7.85 to $17.55. It hit a low of $7.11 during Tuesday's trading.