California Steel Industries' Posts Strong Third Quarter Results
Fontana, CA.-- California Steel Industries, Inc. (“CSI”) today reported strong results for the third quarter ended September 30, 2002. Net income for the period was $11.9 million while EBITDA for the quarter totaled $29.6 million. For the three first quarters of 2002 year to date net income was $25.1 million, with year to date EBITDA of $73.3 million.
Lourenço Gonçalves, President and CEO, commented “CSI once more demonstrates its ability to remain focused on our competitive strengths – operating our slab based business model, making a solid profit, and serving our customers. Third quarter results were again one of the best among all the U.S. steel companies, as we were able to get as much as $44 operating profit per ton. As always, we continue to maximize our opportunities while avoiding potholes in our path."
Mr. Gonçalves stated further that “Mid-Western and Eastern mills are again making offerings for steel here in the West. It seems that the ‘201’ honeymoon is over for them, even without any meaningful increase in imports. For CSI, it means little more than business as usual. We have been anticipating this moment and we have demonstrated a great deal of success in such an environment.”
During the quarter CSI’s sales volumes continued on at a record two million ton pace for 2002. CSI’s sales volume of 508,000 tons represents a 4% increase from the same quarter last year. CSI’s average sales price increased $33 per ton when compared to the second quarter of 2002 and up $39 per net ton when compared to the same period last year. Sales volumes for the quarter were as follows (net tons):
|
3Q2002
|
3Q2001-
|
| Hot Rolled |
235,691
|
218,561
|
| Cold Rolled |
53,523 |
66,710 |
| Galvanized |
182,837 |
168,170 |
| Pipe |
36,333 |
35,244 |
| Total |
508,384 |
488,685 |
Average slab consumption costs (including the FOB slab price, ocean freight, unloading charges, duties, and rail freight from the port of Los Angeles to CSI’s Fontana works) for the quarter increased by approximately $34 per ton when compared to second quarter 2002, and was approximately $11 per ton higher than slab costs in third quarter 2001.
Unaudited figures (in thousands) are as follows:
|
Three Months Ended
|
Nine Months Ended
|
|
9/30/2002
|
9/30/2001
|
9/30/2002
|
9/30/2001
|
| Billed Net Tons |
508.4 |
488.7 |
1,520.4 |
1,378.3 |
| Net Sales Revenue |
$195,812 |
$168,291 |
$541,878 |
$489,119 |
| Cost of Sales |
$166,783 |
$164,537 |
$471,952 |
$469,018 |
| SG&A |
$6,730 |
$5,900 |
$18,162 |
$17,434 |
| Operating Income |
$22,299 |
$(2,146) |
$51,764 |
$2,667 |
| Interest Expense, net |
$3,459 |
$3,946 |
$10,596 |
$12,726 |
| Income (Loss) Before Tax |
$19,852 |
$(6,100) |
$41,680 |
($7,598) |
| Net Income (Loss) |
$11,877 |
$(3,491) |
$25,121 |
($3,797) |
| Depreciation & Amort |
$7,198 |
$7,614 |
$21,898 |
$22,649 |
| EBITDA |
$29,639 |
$5,452 |
$73,304 |
$27,932 |
Regarding the current labor dispute in the West Coast ports, Mr. Gonçalves commented: “The west coast ports situation could have been a concern had we not planned ahead and accumulated additional slabs here in Fontana. Due to our procedure, we have not suffered any impact on our operation or sales."
This release may contain forward-looking statements relating to future financial results. Actual results may differ materially as a result of factors over which the Company has no control. These risk factors and additional information are included in the Company’s reports filed with the Securities and Exchange Commission.
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