Toronto, Canada-based metals service center Russel Metals reported Thursday that net earnings of about $26 million was more than triple the $8.2 million the company earned in Q3 2010. Sales of tubular products for the oil and gas industry boosted earnings for the company as a result of increased drilling activity in both the US and Canada. Revenues in the energy tubular segment increased 19 percent to $223 million year-on-year in Q3. Overall metals service center revenues jumped 24 percent to $390 million compared to the same period last year.
Even with the substantial boost in earnings Russel Metals experienced over the quarter, Brian R. Hedges, President and CEO, remained cautious. "Currently, demand is holding up and our profitability is healthy," he said, and "Gross margin pressure due to lower steel prices will continue but at manageable levels, which is consistent with what our industry experiences over the cycle. We have less visibility on where the market is trending than usual, so we continue to keep inventory levels lean and cautiously evaluate growth opportunities."