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August 2006

 

Schnitzer reports improved results

Schnitzer Steel Industries, Inc. reported net income for the fiscal 2006 third quarter ended May 31, 2006 of $30 million, or $ .98 per diluted share.

Net income was reduced by a charge of $4 million relating to an additional reserve taken by the Company for its current estimate of the monetary component of the settlement of the ongoing investigations into the Company’s past payment practices in Asia.

Excluding the charge, net income was $34 million, or $1.11 per diluted share, a 62% increase from the second quarter.

Net income was reduced by a charge of $15 million relating to a reserve taken for the estimated monetary component of the settlement of the ongoing SEC and Department of Justice investigations into the Company’s past payment practices in Asia. Excluding the gain from the disposition of joint venture assets and the charge for the investigation reserve, year-to-date net income was $74 million.

Revenues from the Metals Recycling Business increased 30% over the second quarter of 2006. The increase was a result of higher sales prices for ferrous and non-ferrous materials and a 28% increase in non-ferrous sales volumes.

The worldwide markets for scrap metal strengthened during the quarter, and export prices were as good as or higher than domestic prices.

Operating income improved 77% from the second quarter even with ferrous shipping volumes slightly lower than anticipated. The improvement was due primarily to the impact of higher non-ferrous prices and volumes and a reduction in processing costs related to an increase in ferrous volumes processed.


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