Commercial Metals Company today announced financial results for its fiscal fourth quarter and year ended August 31, 2017.
For the three months ended August 31, 2017, the loss from continuing operations was $32.7 million on net sales of $1.3 billion, compared to a loss from continuing operations of $2.1 million on net sales of $1.1 billion for the three months ended August 31, 2016.
For the fiscal year ended August 31, 2017, earnings from continuing operations were $32.6 million on net sales of $4.6 billion. This compares to earnings from continuing operations of $57.9 million on net sales of $4.2 billion for the fiscal year ended August 31, 2016.
CMC’s Americas Recycling segment recorded adjusted operating profit of $2.9 million for the fourth quarter of fiscal 2017, compared to adjusted operating loss of $45.1 million for the fourth quarter of fiscal 2016. In a press release, the company said shipments increased 37 percent in comparison to the same period of the prior year as flows through the yards remained strong and as a result of the seven recycling yards that were acquired earlier in fiscal 2017.
The Americas Mills segment recorded adjusted operating profit of $29.8 million for the fourth quarter of fiscal 2017, compared to an adjusted operating profit of $45.0 million for the fourth quarter of fiscal 2016. The company said that despite strong long-steel demand which resulted in an 8 percent increase in shipments in comparison to the same period of the prior year, cost pressures squeezed margins during the quarter.
The Americas Fabrication segment recorded an adjusted operating loss of $4.9 million for the fourth quarter of fiscal 2017, compared to adjusted operating profit of $9.6 million for the fourth quarter of fiscal 2016. The company attributed the decrease in adjusted operating profit for the fourth quarter of fiscal 2017 to a very competitive fabrication market, which resulted in newly awarded contracts being at lower selling prices than in the prior year despite also incurring higher steel input costs.
The International Mill segment recorded adjusted operating profit of $14.6 million for the fourth quarter of fiscal 2017, compared to adjusted operating profit of $18.7 million for the fourth quarter of fiscal 2016. Despite the quarterly results being lower than the prior year, the company said shipped volumes were 16 percent higher in comparison to the same period of the prior year while producing strong earnings throughout fiscal 2017, adding that strong construction market in conjunction with an expansion of higher margin merchant volumes were the main contributor to the results.
As for an outlook, Barbara Smith, President and CEO, said, "Our outlook for demand from the US non-residential construction market remains quite positive, in spite of a lack of movement on infrastructure stimulus. However, market conditions remain very challenging as a result of raw material price changes and escalating input costs. Metal margins remain under pressure due to the ongoing influx of dumped and subsidized imports. We saw a temporary pause in rebar imports after the announcement of the Section 232 review into the effect of imports on national security. However, recent data indicates another surge in rebar imports is on its way. We believe that no action taken by the current Administration to address these unfair trade practices is likely to result in imports returning to their previous high levels, negatively impacting the industry's operating results or potentially even imperiling the long-term viability of the US steel industry."