Portland, Oregon-based scrap recycler and steel manufacturer Schnitzer Steel Industries Inc. reported a fiscal first quarter loss Thursday, citing a drop in demand for scrap and finished steel products.
The company posted a loss of US$34 million for the quarter ended November 30, compared with a profit of $24.7 million in the year-ago period. Revenue for the quarter fell more than 17 percent to $489.6 million from $603.9 million.
"The weak economic environment and the worldwide financial crisis resulted in a rapid and precipitous drop in both sales volumes and sales prices from those experienced in the previous quarter in all of our businesses," said Tamara Lundgren, president and CEO, in a statement.
The company said that since the middle of its fiscal first quarter, it has cut full-time jobs by more than 10 percent and reduced production by 40 percent. Going forward, Schnitzer says it expects the reduced production output to allow the company to bring its inventory more in line with market demand. However, it expects its sales volumes for steel manufacturing to be 10 to 20 percent lower in the fiscal second quarter of '09 compared to the first quarter, and sales volumes for metals recycling to be down 10 to 20 percent.