On Thursday, Portland, Oregon-based steelmaker and metals recycling company Schnitzer Steel Industries, Inc. reported net earnings per share of $0.35 for its fiscal Q2 2012 ended February 29. This compares with diluted earnings per share of $0.25 in the previous fiscal quarter.
Schnitzer's Metals Recycling Business ferrous volumes increased 10 percent from fiscal Q1 as sales volumes of 1.4 million tons rose 10 percent. Export customers accounted for 78 percent of total ferrous volumes; Turkey, South Korea, and China were Schnitzer's top export destinations in Q2. Despite increased volumes, average ferrous prices fell 3 percent in Q2 as the market disruption experienced in Q1, caused mainly by an escalation in the European financial crisis, resulted in a sharp decline in sales prices that impacted shipments during the beginning of Q2. In addition, mild winter conditions during the quarter generated softness in selling prices toward the end of the quarter.
Schnitzer's Auto Parts Business revenues decreased 7 percent on softer commodity prices which reduced selling prices for scrap. Operating income decreased 17 percent due to tighter supply market which compressed margins.
The Steel Manufacturing Business generated a Q2 operating loss of $1 million due to slightly lower utilization levels and planned maintenance costs. Schnitzer's finished steel business also suffered from tepid construction demand on the West Coast. Finished steel sales increased 5 percent from Q1 while selling prices were little changed.