Universal Stainless Reports Fourth Quarter 2011 Results (US)

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    Vaccum Arc Remelted at Universal Stainless ( Credit Photos @ Universal Stainless & Alloy Products, Inc)

    • Fourth Quarter Sales are $62.2 Million; Full Year Sales are Record $252.6 Million
    • Fourth Quarter EPS is $0.59, including $0.13 of Expense for Newly-Acquired North Jackson Operation
    • Full Year 2011 EPS is $2.56, including $0.51 of North Jackson-Related Expense
    • Backlog Reaches Record $102.6 Million at Quarter-End

    BRIDGEVILLE, Pa., Jan. 27, 2012 (GLOBE NEWSWIRE) — Universal Stainless & Alloy Products, Inc. (Nasdaq:USAP) reported today that sales for the fourth quarter of 2011 were $62.2 million, an increase of 21% from sales of $51.6 million in the fourth quarter of 2010, but below the record of $67.3 million reached in the 2011 third quarter. Operating income for the 2011 fourth quarter was $7.0 million and included $0.9 million of operating expense related to the start-up of the North Jackson operation acquired by the Company in August 2011. Operating income was $5.5 million in the fourth quarter of 2010, and $7.2 million in the 2011 third quarter, which included $1.7 million of operating expense related to the acquisition and start-up of the North Jackson operation. Net income for the fourth quarter of 2011 was $4.3 million, or $0.59 per diluted share, including an after-tax loss attributable to the North Jackson operation of $0.7 million, which reduced EPS by $0.13 per diluted share. Excluding these North Jackson-related costs, net income for the 2011 fourth quarter was $5.0 million or $0.72 per diluted share. Net income for the fourth quarter of 2010 was $3.6 million, or $0.52 per diluted share. In the third quarter of 2011, net income was $3.9 million, or $0.55 per diluted share, including North Jackson-related acquisition and start-up expenses of $1.9 million, or $0.28 per diluted share. For full year 2011, sales increased 33% to a record $252.6 million compared with $189.4 million for 2010, while net income rose 37% to $18.1 million, or $2.56 per diluted share, including after-tax expense of $3.2 million, or $0.51 per diluted share, related to the acquisition, financing and start-up of the North Jackson operation.    For the fourth quarter of 2011, cash flow from operations reached $9.6 million. Capital expenditures were $16.6 million for the fourth quarter, including $14.4 million for the North Jackson operation. At December 31, 2011, the Company had cash of $0.3 million and total debt of $94.7 million, or 34.4% of total capitalization. Shipment volume for the fourth quarter of 2011 increased 4% from the fourth quarter of 2010 but was 8% lower than the 2011 third quarter. Compared with the fourth quarter of 2010, volume shipped to the aerospace and service center plate markets increased 31% and 13%, respectively, while volume shipped to the petrochemical and power generation markets was lower by 1% and 15%, respectively. Compared with the third quarter of 2011, volume shipped to the aerospace market increased 3%, while volume shipped to both the petrochemical and power generation market was down 8% and service center plate volume was down 27%.

    Chairman, President and CEO Dennis Oates commented: “End market trends remained favorable and our sales were strong in the fourth quarter, although they did not match the third quarter mainly due to customer receiving schedules shifting from December into the first quarter of 2012. Record order entry in the fourth quarter contributed to a new peak in our backlog of $102.6 million at quarter-end, including $14.0 million for our new North Jackson facility. “Driving profitable growth remained a main focus in the quarter through higher value sales mix, cost reduction and pricing actions. As a result, we achieved a consolidated operating margin on our legacy Universal business (before including North Jackson) of 12.8%, which was among the highest in the past four years, despite a continued decline in nickel prices.

    “The accelerated start-up of North Jackson is on schedule. In December, our team completed first heats on our vacuum induction melting (VIM) furnace and on two newly installed vacuum arc remelting (VAR) furnaces.

    “We have entered 2012 with positive market momentum, record backlog and a full focus on accelerating the ramp-up of our North Jackson operation to achieve further profitable growth.”

    Segment Review

    For the fourth quarter of 2011, the Universal Stainless & Alloy Products segment, including the North Jackson operation, had sales of $49.2 million and operating income of $4.0 million, yielding an operating margin of 8.2% of sales. Before including the North Jackson operation, segment sales were $48.6 million and operating income was $4.9 million, or 10.1% of sales. In the fourth quarter of 2010, sales were $46.1 million and operating income was $4.2 million, or 9.2% of sales. For the third quarter of 2011, segment sales, including the North Jackson operation, were $60.6 million and operating income was $4.8 million, or 7.9% of sales. Before including North Jackson, segment operating income was $6.5 million, or 10.7% of sales.

    Segment sales rose 7% from the fourth quarter of 2010 on 2% lower tons shipped mainly due to increased shipments to service centers. Segment sales were 19% lower than the 2011 third quarter on 14% lower volume mainly due to lower shipments to service centers and forgers.

    Sales for the Dunkirk Specialty Steel segment were $24.5 million for the fourth quarter of 2011 and operating income was $2.5 million, yielding an operating margin of 10.1% of sales. This compares with sales in the fourth quarter of 2010 of $17.1 million and operating income of $1.3 million, or 7.8% of sales. In the third quarter of 2011, sales were $25.3 million and operating income was $2.5 million, or 9.9% of sales.

    Dunkirk’s sales increased 43% from the fourth quarter of 2010 on a 34% increase in tons shipped, mainly due to increased shipments to service centers. Dunkirk’s sales decreased 3% from the third quarter of 2011 on 5% lower tons shipped, mainly due to lower shipments to service centers and lower conversion pounds.

    Posted in Non classé.

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