Metalico Inc. posted a net loss in the second quarter due to an
overhang of shredded scrap and tepid demand in the export
arena, which the company said it expects will linger into the
N.J.-based scrap processor posted a net loss of $2.7 million
for the three months ended June 30 in contrast to net income of
$2.9 million in the same period last year, on sales that fell
12.4 percent to $129.9 million.
"We are certainly not
pleased with the results, which were impacted by lower
commodity selling prices across most product lines," president
and chief executive officer Carlos E. Agüero said.
Scrap shipments in the
quarter were in line with last yearferrous shipments of
136,200 gross tons were down 2.6 percent while nonferrous
shipments of 44.3 million pounds were up 0.8 percentbut
ferrous and nonferrous selling prices were down 12 percent and
9 percent, respectively.
metal recycling segment posted a second-quarter operating loss
of $3.3 million vs. a $149,000 operating loss a year ago, while
the lead fabrication segment posted operating earnings of $1.2
million, up 15.9 percent from $1.1 million in the same
"Sluggish demand from
exporters and an oversupplied domestic shred market have
impacted the price gains achieved in July 2013 and are expected
to be soft into the fourth quarter," the company said. It noted
that domestic steel industry utilization rates have been
dampened by imports of finished steel products.
The company said new
car sales are increasing the volume of vehicles being scrapped,
which is keeping inflows of material at an adequate level.
"Weve seen some improvement of flows into our yards but
scrap is still being bid up from our buyers," Agüero
The company said it is
planning to sell noncore assets, control costs and refinance
debt as it works to improve margins and restore its