Metalico posts sales of $169 million in third
Metalico, Inc. reported net income of $5.1
million for the third quarter, equivalent to $0.11 per diluted
share, increases of 13 percent and 10 percent, respectively,
above the comparable results for the prior year.
The company posted sales of $169 million for the quarter ended
September 30, as compared to $137 million in the 2010 period,
when it reported net income of $4.5 million, or $0.10 per share.
Operating income in the third quarter was negatively impacted
by scrap metal cost pressures and fell to $6.5 million compared
to $9.1 million (as adjusted for insurance recovery) in the prior
The company’s ferrous and nonferrous recycling business continues
to perform profitably, but with lower metal margins. Operating
income suffered from scrap purchase prices rising faster than
related selling prices. Competitive pressures are being driven
by a stagnant to declining supply of scrap being pursued by more
prospective acquirers. Year to date, metals recycling contributed
73 percent of operating income on 59 percent of consolidated
PGM recycling has been impacted by restricted supply and volatile
pricing. The result is fewer units purchased and tighter operating
margins, which contributed to segment income dropping by 21 percent
from last year. Molybdenum selling prices were falling throughout
the quarter while average inventory costs dropped more slowly,
which impacted margins.
Lead commodity prices also fell during the period but a change
in Metalico’s product mix, coupled with selective cost pass-throughs,
kept selling prices flat. Year-over-year volume sold was virtually
the same at 12.7 million pounds.