North American metals distribution company Russel Metals reported that Q4 2012 earnings totaled $20 million or $0.34 per share on revenues of $766 million, compared to 2011 Q4 earnings per share of $0.47 on revenues of $712 million.
Operating profits in Q4 2012 for the metals service centers were $17 million down from $21 million in Q4 2011. Results were impacted by an industry-wide drop in volumes in November and December beyond expected seasonality. Additionally, in September 2012, the unionized employees at the Boucherville, Quebec operation took strike action and this work stoppage was resolved on February 7, 2013. The strike reduced operating income by approximately $2 million in the quarter.
The steel distributor segment Q4 operating profits decreased to $7 million from $11 million in 2011 due to soft demand and tightening margins.
For the year, earnings were $99 million or $1.64 per share on revenues of $3.0 billion versus 2011 earnings of $118 million or $1.97 per share on revenues of $2.7 billion.
Brian R. Hedges, President and CEO, said: "2012 was an exciting year as we made three acquisitions, highlighted by the purchase of Apex Distribution. Through these acquisitions we believe that we have strengthened the Company's ability to generate earnings over the cycle and we are well positioned to reap the benefits in 2013 and beyond. During the fourth quarter we experienced a weakness in demand in all segments; however, our metals service centers outperformed the industry shipment volumes reported by the Metals Service Center Institute. The stabilization of gross margins in the fourth quarter and the recent upward price movement by the mills should lead to higher margins in 2013. We look forward to the expected materialization of a full year's benefits relating to the acquisitions we made in 2012."