NEW YORK Commercial Metals Co. (CMC) earnings fell in its fiscal first quarter due in part to a weaker performance by its Americas Fabrication segment, offset by strong gains by its mill divisions.
The Irving, Texas-based steelmaker and metals recycler posted net income of $45.92 million for the three months ended Nov. 30, down 7.6 percent from $49.72 million in the same period a year earlier, on sales that fell 3.8 percent to $1.68 billion.
"We anticipate our fiscal second quarter to be seasonally slower as a result of holiday slowdowns and winter weather conditions, which reduce construction activities," chairman, president and chief executive officer Joseph Alvarado said in a statement. "However, many of the economic indicators we highlighted in our prior earnings release for the fiscal fourth quarter of 2013 remain encouraging."
The Americas Fabrication segment recorded operating earnings of nearly $2.22 million in the latest quarter on shipments of 267,000 tons, down 78.2 percent from $10.19 million on shipments of 260,000 tons a year earlier due to an unfavorable change in pretax last-in, first-out (Lifo) inventories.
The companys Americas Mills segment posted $65.81 million in operating earnings for the quarter, up 27.4 percent from $51.66 million in the same period a year earlier, while its International Mill segments operating earnings jumped to $15.27 million from $876,000.
Alvarado said the company will take advantage of expected slower business activity in its fiscal second quarter to take planned outages for maintenance and upgrade equipment, similar to previous years, but he did not provide specifics.