Schnitzer Steel Industries, Inc. today reported Tuesday financial results for its fourth quarter and fiscal year ended August 31, 2015.
Fourth quarter adjusted earnings per share from continuing operations improved from the third quarter, reflecting increased profitability in both the Auto and Metals Recycling (AMR) and Steel Manufacturing Business (SMB).
The Company announced adjusted earnings per share from continuing operations of $0.31 for the fourth quarter ended August 31, 2015, which compares to third quarter fiscal 2015 adjusted results of break-even and fourth quarter fiscal 2014 adjusted earnings per share of $0.36. Fourth quarter adjusted results included an adverse impact from average inventory accounting of approximately $0.14 per share which compares to a third quarter adverse impact of $0.40 and fourth quarter of fiscal 2014 which had a neutral impact.
Ferrous sales volumes of 929 thousand tons in the fourth quarter declined 8 percent from the third quarter and were slightly lower than our previously announced preliminary estimates. Higher sales to the domestic market partially offset the adverse impact of weaker export demand on volumes. Nonferrous sales volumes of 176 million pounds increased 23 percent sequentially, primarily reflecting the timing of processed volumes and shipments. Cars purchased by the auto stores increased 11 percent from the third quarter which was adversely impacted by a sharp drop in commodity prices.
Export customers accounted for 59 percent of total ferrous sales volumes in the fourth quarter. Ferrous and nonferrous products were shipped to 13 countries, with Turkey, South Korea and Thailand the top export destinations for ferrous shipments.
Ferrous sales prices fell during July and August by approximately $50 per ton. As a result, average ferrous net sales prices decreased $4 per ton, or 2 percent, from third quarter levels.
The company said that since the end of the fiscal fourth quarter, both domestic and export ferrous market prices have declined by approximately 20 percent which could result in an adverse impact from average inventory accounting in the first quarter of fiscal 2016.
Finished steel sales volumes of 145 thousand tons increased 3 percent sequentially due to improving demand for long products from West Coast nonresidential construction markets. Average net sales prices for finished steel products decreased 3 percent from third quarter levels, reflecting pressure on selling prices from increased import volumes. Operating income of $6 million increased sequentially by 39 percent, reflecting higher sales volumes and increased operating leverage resulting from higher production levels.