Metals USA posts lower net income for 2005

Leading metals distributor Metals USA announced its 2005 fiscal earnings, in which net sales totaled $1.64 billion, up from $1.51 billion earned in fiscal 2004. Net income totaled $41.5 million, down significantly from 2004 net income of $104.5 million. The slump in net income was largely due to less than stellar fourth quarter figures, also reported. In the fourth quarter of 2005, Metals USA earned $388.5 million, down from $394.4 million earned in Q4 2004. For net income, the company reported a net loss of $1.3 million, down from a net income of $20.5 million in Q4 2004. In 2005, Metals USA made the strategic decision to reduce inventories at its service centers to historically low levels. President and CEO, Lourenco Goncalves, commented on this major move: "Our ability to work out of a reduced inventory has proven itself to be good for Metals USA, good for the service center industry, and most importantly, good for the entire supply chain. Lower inventory levels are not only sustainable but should support even greater profitability in our business going forward." Looking forward, Mr. Goncalves said, "The market is clearly beginning to understand that the steel industry, both in the US and internationally, has changed for the better. Sustainability is the new reality and Metals USA is in a great position to maximize its opportunities in this new environment." Houston, Texas-based Metals USA provides a wide range of products and services in the heavy carbon steel, flat rolled steel, specialty metals, and building products markets.