Metals service center Ryerson Inc., Chicago, IL, reported its first quarter 2006 sales of $1.4 billion decreased 6% from the first quarter 2050 and increased 11% from the fourth quarter 2005. For the first quarter of 2006, tons shipped declined 3.8% while the average selling price was down 2.2%, year-over-year. The average selling price per ton increased 6.2% from the fourth quarter 2005.
Gross profit per ton was $259 in the first quarter of 2006, compared to $276 in the first quarter of 2005 and $240 in the fourth quarter of 2005. Gross margins of 15.4 percent in the first quarter of 2006 compared with 16.0 percent in the first quarter of 2005 and 15.1 percent in the fourth quarter of 2005.
First quarter results included a gain on the sale of assets of $21 million from the sale of the company’s U.S. oil and gas, tubular alloy and bar alloy business.
“We were pleasantly surprised with the strength of the market in the first quarter of 2006,” said Neil S. Novich, Chairman, President, and CEO of Ryerson. “With strong market conditions and mill price increases, we realized higher prices as the quarter progressed. However, our volume in the quarter was affected by the loss of two large accounts one of which went mill direct while the other relocated operations offshore. We continued to make progress on the Integris integration, with annualized cost synergies by first quarter end 2006 exceeding half of our $50 million target, offset mainly by inflationary increases in certain operating expenses.”
“While market conditions remain strong, we are experiencing some spot shortages as mill lead times extend and imports are becoming less available,” concluded Novich. “We continue to make progress rolling out SAP and realizing the synergies of the Integris acquisition.”
Ryerson Inc. is a distributor and processor of metals, with 2005 revenues of $5.8 billion. The company services customers through a network of service centers across the United States and in Canada, Mexico, and India.
