CHICAGO Service center chain Olympic Steel Inc. posted a fourth-quarter net loss of more than $10.1 million, largely the result of a $6.6-million goodwill impairment charge related to flat products in its southern operations, in contrast to net income of $565,000 in the last three months of 2011.
Fourth-quarter sales of $291.72 million were down 8.8 percent from $319.94 million a year earlier.
"During 2012, we made significant progress on a variety of growth and development initiatives. We successfully ramped up several new facilities and completed major capital projects to enhance future profitability," chairman and chief executive officer Michael D. Siegal said in a statement. "The year ended with a disappointing quarter, however, as steel demand and pricing declined in tandem with mounting political and fiscal uncertainty, masking much of our operational headway."
The Bedford Heights, Ohio-based processor and distributor posted full-year net income of $2.28 million, down nearly 91 percent from $24.97 million the previous year despite a 9.7-percent increase in sales to more than $1.38 billion.
"Entering 2013, we are encouraged by recovering demand for steel products," Siegal said. "Now, the vast majority of cash outlays associated with the multiyear capital expansion projects are behind us, and our focus is on harnessing their potential to increase earnings and cash flow."
The companys inventories were valued at $290 million at the end of 2012, up 4.4 percent from $277.8 million a year earlier.