Schnitzer Steel Reports Record Quarter

Tag : Parts For Car
Schnitzer SteelIndustries, Inc. (Nasdaq:SCHN) today reported record quarterly netincome of $62 million, or $2.14 per diluted share, for the fiscal2008 third quarter ended May 31, 2008. Revenues of $972 millionwere also a quarterly record. Compared to the third quarter offiscal 2007, revenues increased 37% and diluted earnings per shareincreased 46%.
"We are pleased to report the strongest quarterly financial resultsin the Company's history, as each of our three operating divisionsposted record revenues and operating income," said John D. Carter,President and Chief Executive Officer. "Global demand for recycledmetals remained robust, driven by economic growth in developingcountries. In the Metals Recycling Business, our worldwide marketvisibility and flexibility to sell both domestically andinternationally allowed us to take advantage of strong markets andsignificantly expand margins and operating income."
"In the Steel Manufacturing Business, tight domestic supplyconditions resulting from a low level of imports affecting ourproduct lines contributed to record quarterly sales volumes andrecord selling prices for finished steel products," added Carter."The Auto Parts Business continued its focus on increasing vehiclepurchases which led to its sixth consecutive quarter of year overyear operating income growth."
Commenting on the third quarter results, Tamara Lundgren, ExecutiveVice President and Chief Operating Officer, said "All three of theCompany's operating divisions were able to maximize the benefits ofthe strong markets in which we operate through operatingefficiencies and higher throughput. In the Metals RecyclingBusiness, our capital investments to increase capacity allowed usto process the strong inflow of raw materials at all our majorlocations. Increased production capacity enabled the SteelManufacturing Business to produce and ship record sales volumes,and in the Auto Parts Business our ability to process the increasedcar purchases while extracting more value from every car was amajor factor in achieving record operating income."
Metals Recycling Business
The Metals Recycling Business continued to leverage its bi-coastalport facilities to access the robust export markets for recycledmetals.
Revenues for the Metals Recycling Business increased 38% over thethird quarter of 2007, primarily as a result of record ferrousscrap prices and higher nonferrous sales volumes. Average netferrous processing sales prices were $463/ton, a 57% year over yearincrease, while nonferrous sales volumes increased 19% over lastyear.
Operating income for the quarter was 70% higher than the thirdquarter of 2007. During the quarter, export sales prices increasedmore rapidly than domestic purchase prices for ferrous scrap and,combined with higher ferrous and nonferrous processing salesvolumes, resulted in the significant increase in year over yearoperating income and operating margins.
Auto Parts Business
A continued focus on increasing car volumes, combined with higherprices for cores and scrap, resulted in healthy year over yeargrowth in sales and operating income for the Auto Parts Business.
Third quarter revenues for the Auto Parts Business increased 41%over the same period last year, primarily as a result of a 20%increase in self-service car volumes, higher per car sales of coresand scrap and improved full-service and self-service parts sales.
Operating income increased 64% from the third quarter of 2007,primarily due to the increased car volumes and significantlyimproved margins on scrap and core sales.
Steel Manufacturing Business
The Steel Manufacturing Business utilized its increased productioncapacity to produce and ship record sales volumes for the secondconsecutive quarter.