Russel Metals Inc. announced second-quarter earnings of $19 million, or $0.31 per share, an improvement of $0.28 per share from the first quarter of 2010. These results were stronger than both the comparable adjusted net earnings for the second quarter of 2009 of $0.10 per share and the reported loss of $0.41 per share.
Year-to-date earnings for 2010 are $35 million, or $0.59 per share. Revenues for the six months to June 30, 2010, were $1.0 billion.
Consolidated revenues for Q2 2010 were $506 million, up 9% from the same period last year. The improved operating results compared to the first quarter of 2010 were primarily generated by stronger gross margins on higher average selling prices.
Metals service centers volumes increased 14% from the comparable quarter in 2009 and 4% from the first quarter of 2010, resulting in revenues for the quarter of $312 million. Improved gross margin dollars due to higher selling prices resulted in an operating profit of $19 million for Q2 2010 compared to $2 million last year and $15 million in Q1 2010.
Energy tubular products revenues were $129 million in the second quarter of 2010, a decline from the first quarter due to seasonality and consistent with last year’s second quarter. Operating profits were $11 million for the second quarter, consistent with the first quarter due to improved selling prices offsetting the lower volumes.
Revenues for steel distributors operations increased to $61 million, the highest level in the past year. Demand from customers and rising selling prices contributed to the increased revenue and operating profit. Operating profits were $7 million, up from $4 million in the first quarter of 2010.
Brian R. Hedges, President and CEO, said, "Our second quarter continued to improve from the first quarter. Improved volumes, margins, and higher selling prices all contributed to stronger results. We will be challenged to maintain this momentum, particularly in our service center operations in the summer months, but anticipate an improvement in the fall. We continue to look at potential acquisitions, green fields, and operational savings."
The Board of Directors approved a quarterly dividend of $0.25 per common share payable September 15, 2010, to shareholders of record as of August 30, 2010.
Russel Metals is one of the largest metals distribution companies in North America. It carries on business in three distribution segments: metals service centers, energy tubular products, and steel distributors, under various names including Russel Metals, A.J. Forsyth, Acier Leroux, Acier Loubier, Acier Richler, Arrow Steel Processors, B&T Steel, Baldwin International, Comco Pipe and Supply, Fedmet Tubulars, JMS Russel Metals, Leroux Steel, McCabe Steel, Mégantic Métal, Métaux Russel, Métaux Russel Produits Spécialisés, Milspec, Norton Metals, Pioneer Pipe, Russel Metals Specialty Products, Russel Metals Williams Bahcall, Spartan Steel Products, Sunbelt Group, Triumph Tubular & Supply, Wirth Steel and York-Ennis.