Commercial Metals ends Q3 with $1 billion liquidity, net sales dip

By Lisa Kerner

Charlotte, N.C., June 25 – Commercial Metals Co. ended its third quarter on May 31 with liquidity of about $1 billion and cash and cash equivalents of $381 million, said chief financial officer Barbara Smith during the company’s earnings conference call on Thursday.

During the quarter, the company repurchased about 139,000 shares of its common stock for $2.2 million, Smith said.

Commercial Metals’ domestic mills benefitted from expanding metal margins as a result of lower raw material prices versus a year ago, according to chief executive officer Joe Alvarado.

Rainfall slowed the company’s shipments in the central and eastern regions of the United States during the period. However, Alvarado expressed confidence that U.S. construction activity will continue to improve during the summer months, resulting in improved activity in Commercial Metals’ domestic business.

Looking ahead, Alvarado said the demand for the company’s finished steel products in the United States and Poland remains high. Increased imports, however, continue to pressure margins in those business segments. Additionally, the strong U.S. dollar continues to challenge the company’s international marketing and distribution segment.

Financial highlights

Commercial Metals had net earnings of $56.7 million, or $0.49 per diluted share, on net sales of $1.5 billion. This compares to net earnings $23.6 million, or $0.20 per diluted share, on net sales of $1.7 billion for the prior-year period.

Adjusted EBITDA from continuing operations was $158.5 million for the period, compared with $90.4 million for the third quarter of fiscal 2014, according to the earnings news release.

On June 24, Commercial Metals’ board declared a quarterly dividend of $0.12 per share for shareholders of record on July 9, payable on July 23.

Commercial Metals manufactures, recycles and markets steel and metal products as well as related materials and services. The company is based in Irving, Texas.

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