CMC reports higher net earnings in fiscal Q3

Thursday, 20 June 2019 00:22:27 (GMT+3)   |   San Diego

Commercial Metals Company today announced financial results for its fiscal third quarter ended May 31, 2019.  For the three months ended May 31, 2019, earnings from continuing operations were $78.6 million on net sales of $1.6 billion, compared to earnings from continuing operations of $42.3 million on net sales of $1.2 billion for the prior year period. Revenue increased 33 percent on a year-over-year basis driven by the company's growth strategy and strong fundamentals in its core markets.

Third quarter fiscal 2019 results included net after tax expenses of $1.8 million related to certain non-operational costs related to the acquisition of rebar assets from Gerdau S.A.  Excluding these expenses, adjusted earnings from continuing operations were $80.4 million.

Excluding non-recurring integration related costs related to the four steel mills and rebar fabrication assets purchased from Gerdau S.A., that closed on November 5, 2018, the acquired assets contributed revenue of $453.5 million and operating income of $56.6 million to the consolidated results of CMC in the third quarter of fiscal 2019.

Barbara R. Smith, Chairman of the Board, President and Chief Executive Officer, said, “The strong results for the quarter reflect the strength of construction activity, as well as solid industrial production levels and the resilient U.S. and Polish economies. Our recent acquisition, our greenfield Oklahoma facility, and introduction of hot spooled rebar were all meaningful contributors to top and bottom line financial results.  In addition, the fundamentals of the fabrication segment have improved significantly as we have shipped the majority of the lower priced work in our backlog which has resulted in a significant improvement in the segment results.”

As for an outlook, Smith said: “Our outlook for demand remains very positive driven by the continued strength in non-residential construction activity levels in our markets. Leveraging the growth in our business from the acquisition, combined with the continued favorable long steel margin environment and improvement in our fabrication segment, we anticipate a strong finish to our fiscal year.”

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