NEW YORK Universal
Stainless & Alloy Products Inc. suffered a 24.2-percent
drop in sales in the fourth quarter after "an expected pickup
in order entry at year-end failed to materialize."
The Bridgeville, Pa.-based
company posted sales of $47.15 million for the three months
ended Dec. 31 vs. $62.17 million in the same period a year
earlier, and net income plunged 74.6 percent to $1.08 million
from nearly $4.26 million.
Full-year net income of $14.62
million was down 19.3 percent from $18.12 million in 2011 on
sales that slipped 0.6 percent to $250.99 million.
Shipment volumes in the fourth
quarter decreased 25 percent from a year earlier, primarily
fueled by decreases of 20 percent, 41 percent and 53 percent in
shipments to the aerospace, petrochemical and power generation
The second half of 2012 was the
"most challenging" for the company since 2009, Universal
chairman, president and chief executive officer Dennis Oates
said in a Jan. 29 conference call.
"Our fourth-quarter sales were
consistent with low activity levels industry-wide," he said.
"An expected pickup in order entry at year-end failed to
materialize as economic uncertainty kept customers focused on
Oates said that the company is
entering the "final stages" of ramping up the North Jackson,
Ohio, facility it acquired in June 2011 (
amm.com, June 15, 2011). The company currently is
working with customers on vacuum induction melting (VIM)
products to be generated at the plant.
"We expect our North Jackson
operation to begin making an increasingly positive contribution
to our results as we go through 2013," Oates said. "In
addition, there are early signs that some customers are
returning to the market, although most are predicting a gradual
recovery in meaningful demand."
Oates noted that activity in
January has been markedly improved from the fourth quarter of
2012, and he expects the sales recovery to pick up momentum in
the second half of 2013.
"Our customers are telling us
they need the first quarter to get back into balance and that
in March youll start to see some pickup," he said.
"Id say that aerospace is the market closest to being in
balance; when I look at our orders for this year, most of them
are in aerospace."