By Paul Ploumis 01 Jul 2015 Last updated at 03:30:01 GMT
SEATTLE (Scrap Monster): Portland, Oregon-headquartered Schnitzer Steel Industries Inc. has reported improved operating performance during the fiscal 2015 third quarter that ended in May 31st, 2015. The quarterly results suggest that the various cost reduction steps and productivity enhancement initiatives implemented by the company during the month of April this year has done good for the company to elevate the performance across all business units.
According to Tamara Lundgren, President and CEO, the company expects to complete the consolidation of auto parts and metal recycling units by fourth quarter this fiscal. The benefits of cost savings and production boost initiatives will continue to contribute significantly. The stable market conditions are expected to further lift the company’s performance during the forthcoming quarters, he added.
Schnitzer’s metal recycling business reported significant growth during Q3. The company’s ferrous scrap volumes jumped by almost 29% when compared with the previous quarter. Meantime, non-ferrous scrap volumes too rose 21% quarter-on-quarter. The rapid decline in ferrous scrap prices during February dragged the shipment volume lower during the quarter. However, average inventory costs did not decline as quickly as ferrous scrap selling prices.
The company reported improved performance by its auto parts unit on the back of robust seasonal activity. The increased demand from West Coast construction markets led to big jump in sales volume and operating profits from steel manufacturing division. In addition, the company’s total debt was reduced to $263 million, on account of realization of $64 million operating cash flow during the quarter.
Schnitzer is a global leader in the metals recycling industry. Founded in 1906, the company collects, processes and recycles raw scrap metal (ferrous and nonferrous) and provides processed scrap metal to mills and foundries around the world. The used auto parts business provides low-cost quality parts to customers across the U.S. and Canada. Also, Schnitzer’s steel manufacturing business makes quality finished steel products from recycled scrap metal.