Schnitzer Reports Third Quarter Fiscal 2012 Financial Results

Schnitzer Steel Industries, Inc. (Nasdaq:SCHN) today reported diluted earnings per share from continuing operations of $0.40 for its fiscal 2012 third quarter ended May 31, 2012, an increase of 16% from $0.35 reported in the second quarter of fiscal 2012. The Company generated $95 million in operating cash flow during the third quarter and reduced total debt to total capital to 24%, down from 27% at the end of the second quarter of fiscal 2012.

These results exceeded the third quarter market outlook we previously provided. In our Metals Recycling Business, operating income per ton of $13 was higher than anticipated due to benefits from higher production and lower cost of goods sold. Our Auto Parts Business and Steel Manufacturing Business also performed slightly better than the outlook. Corporate costs were lower by $1 million sequentially due to reduced compensation accruals.
Summary Results from Continuing Operations
($ in millions, except per share amounts)
3Q12   2Q12   % Change   3Q11
Revenues $ 880   $ 887   (1 )%   $ 981
Operating Income 22 18 23 % 55
Income from continuing operations attributable to SSI* 11 10 17 % 33
Net income per share from continuing operations attributable to SSI** $ 0.40 $ 0.35 16 % $ 1.17
* Excludes income attributable to noncontrolling interests
** Excludes results from discontinued operations

"Our consolidated third quarter operating income improved 23% from the second quarter, primarily due to our Auto Parts Business which benefited from higher parts sales and lower SG&A, achieving a 6% sequential growth in revenues and a 44% increase in operating income," said Tamara Lundgren, President and Chief Executive Officer. "In our Metals Recycling Business and Steel Manufacturing Business, results reflected relatively stable volumes and a flat selling price environment. However, all of our divisions continue to be impacted by challenging market conditions resulting from the global economic slowdown."

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