NEW YORK Reliance Steel & Aluminum Co. expects only slight improvements in demand and generally flat pricing in the third quarter due to global economic uncertainty, the company said in its second-quarter earnings report.
The Los Angeles-based distributor posted net income of $81 million for the three months ended June 30, down 25.6 percent from $108.8 million in the same period last year despite a 10.8-percent increase in sales to nearly $2.45 billion. First-half net income of $164.7 million was down 26.8 percent from $225 million a year earlier on sales that slipped 0.5 percent to $4.47 billion.
Reliances carbon steel sales volume increased 27.1 percent in the second quarter to 1.17 million tons, aluminum sales were up 22.3 percent from a year earlier to 76,200 tons and stainless steel sales rose 20.5 percent to 72,400 tons. The company completed its $1.25-billion acquisition of Metal USA Holdings Corp. during the quarter.
However, prices were down across the board, with carbon steel falling 10.5 percent compared with the second quarter of last year, aluminum was down 7 percent and stainless steel was 14 percent lower.
Reliance said that the automotive market remains a bright spot and it expects modest growth in the oil and gas, heavy industry and aerospace markets, although pricing in the oil and gas sector is expected to be pressured by excess capacity.
The nonresidential market is undergoing a slow but steady recovery, which is expected to continue, the company said.