Ryerson Holding Corporation, a leading value-added processor and distributor of industrial metals, today provided guidance for its third quarter ending September 30, 2017.
The company anticipates revenue in the range of $840 million to $860 million for the third quarter of 2017 compared to $875 million in the second quarter of 2017 and $735 million in the third quarter of 2016.
Third quarter 2017 net income is expected to be in the range of $0 million to $2 million. Ryerson reported third quarter 2016 net income of $8 million and second quarter of 2017 net income of $1 million.
Ryerson's end markets as measured in shipments per day showed sequential quarterly growth in the construction equipment and food processing and agricultural equipment industries, and declines in the oil & gas and HVAC sectors. Ryerson experienced quarterly year-over-year growth in nearly all end markets, most notably in commercial ground transportation, oil and gas, and construction equipment sectors, while consumer durables experienced quarterly year-over-year demand declines.
In a press release, the company said it continues to see improved demand when viewed against the year ago period. According to the Metal Service Center Institute, US service center volumes have increased by more than three percent through August 2017 year-to-date compared to the prior year period. However, elevated import levels, well supplied metals markets, and Section 232-driven panic buying throughout 2017 have muted pricing. The muted pricing together with higher procured metal costs resulted in margin compression through the quarter.
According to Ryerson, overall third quarter industrial economic demand conditions appeared consistent with the prior quarter. Moreover, a weaker US dollar and improved global pricing conditions have narrowed spreads between foreign and domestic steel pricing. Commodity prices have trended higher sequentially from the second quarter through the third quarter on balance despite continuing volatility in industrial base metal markets. Consequently, the company anticipates a better gross margin climate in the fourth quarter of 2017.