Schnitzer Steel (SCHN) Cuts Q1 Outlook on Weaker Recycled Metal Market Conditions
Tweet
Share
E-mailGet Alerts SCHN Hot Sheet
Join SI Premium – FREE
Schnitzer Steel Industries, Inc. (Nasdaq: SCHN) will report on Monday, January 9, 2012, the financial results for its fiscal 2012 first quarter, which ended on November 30, 2011, and will webcast a conference call to discuss the performance at 11:30 a.m. Eastern on the same day. In advance of its full earnings release, Schnitzer is providing preliminary results for its first quarter of fiscal 2012 to reflect the impact of significant market volatility during the quarter.
Schnitzer expects first quarter results to be lower than the outlook provided in its fourth quarter fiscal 2011 earnings release due to weaker than anticipated global market conditions for recycled metals. Heightened global recessionary concerns, stemming primarily from the European debt crisis which escalated during the quarter, resulted in a significant slowdown in buying patterns and a sharp decline in sales prices. During the quarter, operating margins contracted more than anticipated. The most significant factor affecting operating margins was the negative impact of average inventory costs which did not keep pace with the rapid decline in average net selling prices. Schnitzer’s fully diluted earnings per share are expected to be in the range of $0.18 - $0.25 for the first quarter of fiscal 2012. The Street sees EPS of $0.55.
With respect to our Metals Recycling Business, operating income per ferrous ton is expected to be approximately 50% lower than the $21 per ton recorded in the first quarter of fiscal 2011. In our Auto Parts Business, operating income is expected to be approximately 30% lower than recorded in the first quarter of fiscal 2011. Sales prices began to strengthen towards the end of the quarter, but the improvements are not expected to benefit results until later in the second quarter.
Schnitzer expects first quarter results to be lower than the outlook provided in its fourth quarter fiscal 2011 earnings release due to weaker than anticipated global market conditions for recycled metals. Heightened global recessionary concerns, stemming primarily from the European debt crisis which escalated during the quarter, resulted in a significant slowdown in buying patterns and a sharp decline in sales prices. During the quarter, operating margins contracted more than anticipated. The most significant factor affecting operating margins was the negative impact of average inventory costs which did not keep pace with the rapid decline in average net selling prices. Schnitzer’s fully diluted earnings per share are expected to be in the range of $0.18 - $0.25 for the first quarter of fiscal 2012. The Street sees EPS of $0.55.
With respect to our Metals Recycling Business, operating income per ferrous ton is expected to be approximately 50% lower than the $21 per ton recorded in the first quarter of fiscal 2011. In our Auto Parts Business, operating income is expected to be approximately 30% lower than recorded in the first quarter of fiscal 2011. Sales prices began to strengthen towards the end of the quarter, but the improvements are not expected to benefit results until later in the second quarter.
Serious News for Serious Traders! Try StreetInsider.com Premium Free!
You May Also Be Interested In
- Walmart (WMT) PT Lowered to $130 at UBS on Investment Narrative's Competing Dynamics
- Arena Group to rename as Paradium.AI, ticker changing to PAAI
- S&P 500 may pull back before midterms, but Citi says buy the dip
Create E-mail Alert Related Categories
Guidance, Hot Guidance, Trading HaltsRelated Entities
EarningsSign up for StreetInsider Free!
Receive full access to all new and archived articles, unlimited portfolio tracking, e-mail alerts, custom newswires and RSS feeds - and more!
