Reliance Steel & Aluminum Co. (NYSE:RS) today reported its financial results for the third quarter and nine months ended September 30, 2012.
Third Quarter 2012 Financial Highlights
- Sales were $2.06 billion, down 3.9% from $2.14 billion in the third quarter of 2011 and down 7.0% from $2.21 billion in the second quarter of 2012. Tons sold were up 2.0% from the third quarter of 2011 and down 3.5% from the second quarter of 2012.
- Net income was $98.1 million, up 15.5% from $84.9 million in the third quarter of 2011 and down 9.8% from $108.8 million in the second quarter of 2012.
- Earnings per diluted share were $1.30, up 15.0% from $1.13 in the third quarter of 2011 and down 9.7% from $1.44 in the second quarter of 2012.
- The 2012 third quarter financial results include in cost of sales a pre-tax LIFO credit, or income, of $27.0 million, compared with a pre-tax LIFO charge, or expense, of $22.5 million for the third quarter of 2011 and a credit of $7.5 million for the second quarter of 2012.
- Cash flow from operations was $247.6 million in the 2012 third quarter.
- Quarterly dividend rate was increased to $.25 per share, an increase of 67%.
“Overall demand in the third quarter was in-line with expectations after taking into account normal seasonal fluctuations and one less shipping day compared to the prior quarter and same period last year,” said David H. Hannah, Chairman and CEO of Reliance. “Driven mostly by increased sales of our stainless steel and aluminum products, as well as contributions from our 2011 and 2012 acquisitions, total tons sold increased 2.0% over last year’s third quarter. Additionally, our sales related to the auto industry through our toll processing operations were up significantly compared to last year. However, our net sales reflect downward pressure on pricing, as our average price per ton sold fell 3.8% sequentially and 6.3% year-over-year. While we expected economic uncertainty to continue as we entered the third quarter, price decreases in the quarter were greater than expected for all of our products. Similar to last quarter, pricing trends for our products were supply—not demand—driven, as underlying cost inputs at the producer level continued to decrease, imports remained at high levels and domestic overcapacity persisted. As such, sales momentum continued to decelerate in the quarter relative to the second quarter of 2012. On a year-to-date basis, our tons sold are up 8.5%, operating income is up 13.7%, net income of $323.1 million is up 17.1%, and earnings per diluted share of $4.28 were up 16.3%.”