Oregon Steel Mills, Inc. Announces First Quarter Results

Oregon Steel Mills, Inc. (NYSE:OS):

   Highlights:

   --  Sales were a record $355 million, up 20 percent from the first
        quarter of 2005 on 399,500 tons of shipments

   --  Operating income was $58.7 million, second highest in the
        Company's history

   --  Earnings before interest, taxes, depreciation and amortization
        was $70.3 million, compared to $62.7 million in the first
        quarter of 2005

   --  Net income was $33.4 million ($.93 per diluted share)

   Oregon Steel Mills, Inc. (NYSE:OS) today reported first quarter
net income of $33.4 million ($.93 per diluted share on 35.9 million
shares) compared to a net income of $28.4 million ($.79 per diluted
share on 35.7 million shares) for the first quarter of 2005.
   Sales for the first quarter of 2006 were $355.3 million, a
quarterly Company record. This compares to 2005 first quarter sales of
$296 million. Average sales price per ton in the first quarter of 2006
was $889, also a quarterly record, compared to $856 in the first
quarter of 2005. Overall shipments for the first quarter of 2006 were
399,500 tons compared to 2005 first quarter shipments of 345,700 tons.
The increase in shipments are primarily due to increased shipments of
plate, welded and seamless pipe and structural tubing products
partially offset by lower shipments of rail and rod and bar products.
The Company's seamless pipe mill, which was idled in November of 2003,
was restarted in December of 2005 and shipped 14,000 tons of seamless
casing during the first quarter of 2006. The increases in sales and
average sales price were primarily due to higher shipments of plate
and welded and seamless pipe products (the Company's highest selling
priced products) and higher average selling prices for rail products,
partially offset by lower average selling prices for plate, ERW pipe
and structural tubing products.
   Operating income for the first quarter of 2006 was $58.7 million
(an average of $147 per ton). This compares to operating income for
the first quarter of 2005 of $54.6 million (an average of $158 per
ton). Earnings before interest, taxes, depreciation and amortization
(EBITDA) for the first quarter of 2006 was $70.3 million. This
compares to EBITDA for the first quarter of 2005 of $62.7 million. A
reconciliation of EBITDA is provided in the last table of this press
release. Increased operating income and EBITDA during the first
quarter of 2006 compared to the first quarter of 2005 reflects the
higher shipments noted above and lower average semi-finished steel and
scrap costs, partially offset by lower average selling prices for
plate, ERW pipe and structural tubing products. Operating margin as a
percentage of sales declined from 18.4 percent in the first quarter of
2005 to 16.5 percent in the first quarter of 2006. This change was due
in part to a decline in margins for plate and ERW pipe products,
primarily as a result of lower average selling prices.

   LIQUIDITY

   At March 31, 2006, the Company had $201.7 million of cash, cash
equivalents and short-term investments. Total debt outstanding, net of
cash, cash equivalents and short-term investments was $108.3 million
at March 31, 2006 compared to $132.1 million at December 31, 2005.
During the first quarter of 2006, the Company incurred capital
expenditures of $20 million and depreciation and amortization of $10.9
million. For all of 2006, the Company anticipates that capital
expenditures and depreciation and amortization will be approximately
$89 million and $46 million, respectively.
   At March 31, 2006, inventories were $260.8 million. This compares
to $301.5 million at December 31, 2005. The decrease in inventory is
primarily due to reductions of semi-finished inventory at the
Company's Oregon Steel Division and scrap inventory at the Company's
Rocky Mountain Steel ("RMSM") Division both in terms of quantities and
average cost per ton.

   2006 OUTLOOK

   For 2006, the Company expects to ship approximately 1.8 million
tons of products and generate approximately $1.57 billion in sales. In
the Oregon Steel Division the product mix is expected to consist of
approximately 545,000 tons of plate and coil, 340,000 tons of welded
pipe and 82,000 tons of structural tubing. The RMSM Division expects
to ship approximately 400,000 tons of rail, 330,000 tons of rod and
bar products and 85,000 tons of seamless pipe.
   Expected second quarter of 2006 shipments, in tons, as compared to
previous quarters are as follows:
-0-
*T
                                            Forecast  Actual   Actual
                                            Q2 2006  Q1 2006  Q2 2005
                                            -------- -------- --------
Oregon Steel Division:
Plate and coil                              216,000  184,800  148,500
Welded pipe(1)                               43,000   62,300   66,900
Structural tubing                            22,000   18,400   13,700
Less shipment to affiliates                 (78,000) (48,300) (36,300)
                                            -------- -------- --------
                                            203,000  217,200  192,800
                                            --------------------------
RMSM Division:
Rail                                         98,000   93,300  103,200
Rod and bar                                  84,000   75,000   83,600
Seamless pipe                                23,000   14,000        0
                                            -------- -------- --------
                                            205,000  182,300  186,800
                                            -------- -------- --------
         Total                              408,000  399,500  379,600
                                            ==========================

(1)  Includes large diameter line pipe, ERW line pipe and ERW casing.

*T

   The Company's operating income in the second quarter of 2006 will
be negatively impacted by a $3.6 million charge ($.06 per diluted
share) related to cancellation and buyout costs of a contract to
supply oxygen to the now closed melt shop at the Company's Portland
mill. Annual costs associated with this take or pay contract, which
extended into the year 2011, were approximately $1.8 million per year.
   Jim Declusin, the Company's President and CEO stated, "Despite the
charge related to the oxygen contract buyout, due to continued
strength in most of our product lines, we expect operating income in
the second quarter of 2006 to be higher than the first quarter of
2006. Looking into the second half of the year, we see our product mix
shifting to higher priced, higher margin products, more heavily
weighted to the energy markets. As a result of this change in product
mix and continued expected demand for our non-energy related products,
we anticipate that we will ship approximately 1 million tons in the
second half of 2006 and that our operating income will be up
significantly from that realized in the first half of 2006."

   FORWARD-LOOKING STATEMENTS

   Forward-looking statements in this release are made pursuant to
the safe harbor provisions of the Private Securities Litigation Reform
Act of 1995. Such forward-looking statements are subject to risks and
uncertainties and actual results could differ materially from those
projected. Such risks and uncertainties include, but are not limited
to, general business and economic conditions; competitive products and
pricing, as well as fluctuations in demand; cost and availability of
raw materials; potential equipment malfunction; contract cancellations
and plant construction and repair delays. For more detailed
information, please review the discussion of risks, which may cause
results to differ materially, in the Company's most recently filed
Form 10-K, Form 10-Q and other SEC reports.
   These forward-looking statements should not be relied upon as
representing the Company's views as of any subsequent date and the
Company undertakes no obligation to update or revise the
forward-looking statements, whether as a result of new information,
future events or otherwise, after the date they are made.

   ANNUAL MEETING

   Our 2006 Annual Meeting will be held on Thursday, April 27, 2006
at 8:00 a.m. Pacific Time, at the Heathman Hotel, 1001 S.W. Broadway
in Portland, Oregon 97205.

   CONFERENCE CALL WEBCAST

   On Friday, April 28, 2006 at 8:00 a.m. PT (11:00 a.m. ET), the
Company will hold a conference call to discuss the results of the
first quarter. You are invited to listen to a live broadcast of the
Company's conference call over the Internet, accessible at www.osm.com
on the Investor Relations' page.
   Oregon Steel Mills, Inc. is organized into two divisions. The
Oregon Steel Division produces steel plate, coil, welded pipe and
structural tubing from plants located in Portland, Oregon and Camrose,
Alberta, Canada. The Rocky Mountain Steel Mills Division, located in
Pueblo, Colorado, produces steel rail, rod, bar, and tubular products.
-0-
*T

           Oregon Steel Mills, Inc. and Subsidiary Companies
             Condensed Consolidated Income Statements (1)
         (In thousands, except tonnage and per share amounts)
                              (Unaudited)


                                                    Three Months Ended
                                                        March 31,
                                                       2006     2005
                                                     -------- --------

Sales                                               $355,288 $295,965
Cost of sales                                        275,432  223,430
Selling, general and administrative expenses          21,288   18,053
Gain on sales of assets                                 (168)     (87)
                                                     -------- --------
   Operating income                                   58,736   54,569
Interest expense                                      (6,987)  (8,642)
Other income, net                                      1,726    1,505
Minority interest                                       (998)  (3,076)
                                                     -------- --------
Income before income taxes                            52,477   44,356
Income tax expense                                   (19,126) (16,006)
                                                     -------- --------

    Net income                                      $ 33,351 $ 28,350
                                                     ======== ========

Basic earnings per share                            $    .93 $    .80
Diluted earnings per share                          $    .93 $    .79
Basic weighted average shares outstanding             35,718   35,398
Diluted weighted average shares outstanding           35,866   35,676

Operating income per ton                            $ 147.02 $ 157.85
Operating margin                                        16.5%    18.4%

Depreciation and amortization                       $ 10,850 $  9,731
EBITDA (see attached table)                         $ 70,314 $ 62,729

Total tonnage sold:
   Oregon Steel Division
    Plate and coil                                   136,500  112,400
    Structural tubing                                 18,400   14,800
    Welded pipe                                       62,300   30,300
                                                     -------- --------
                                                     217,200  157,500
                                                     -------- --------
   Rocky Mountain Steel Mills Division
     Rail                                             93,300  101,800
     Rod and bar                                      75,000   86,400
     Seamless pipe                                    14,000        0
                                                     -------- --------
                                                     182,300  188,200
                                                     -------- --------
        Total Company                                399,500  345,700
                                                     ======== ========

Sales:
 Oregon Steel Division                              $219,371 $172,138
 Rocky Mountain Steel Mills Division                 135,917  123,827
                                                     -------- --------
   Total Company                                    $355,288 $295,965
                                                     ======== ========

Operating Income:
   Oregon Steel Division                            $ 38,599 $ 36,155
   Rocky Mountain Steel Division                      20,137   18,414
                                                     -------- --------
      Total Company                                 $ 58,736 $ 54,569
                                                     ======== ========

Average selling price per ton:
 Oregon Steel Division                              $  1,010 $  1,093
 Rocky Mountain Steel Mills Division                $    746 $    658
       Total Company                                $    889 $    856

(1) Certain reclassifications have been made in prior years' periods
    to conform to the current period presentations. Such
    reclassifications do not affect results of operations as
    previously reported.



           Oregon Steel Mills, Inc. and Subsidiary Companies
               Condensed Consolidated Balance Sheets(1)
                            (In thousands)
                              (Unaudited)

                                              March 31,  December 31,
                                                 2006        2005
                                             -------------------------
Current assets:
    Cash and cash equivalents                $    84,996  $    74,965
    Short-term investments                       116,675      103,300
    Trade accounts receivable, net               166,407      138,456
    Inventories                                  260,796      301,546
    Deferred taxes and other current assets       16,671       17,753
                                              -----------  -----------
                                                 645,545      636,020
Property, plant and equipment, net               511,298      499,122
Goodwill                                           4,458        4,458
Intangibles, net                                  30,415       30,456
Other assets                                       5,254        5,824
                                              -----------  -----------
          Total assets                       $ 1,196,970  $ 1,175,880
                                              ===========  ===========

Current liabilities                          $   144,284  $   167,634
Long-term debt                                   307,956      308,337
Deferred taxes                                    50,678       43,133
Other liabilities                                 95,132       92,507
                                              -----------  -----------
                                                 598,050      611,611
Minority interest                                 12,867       11,869
Stockholders' equity                             586,053      552,400
                                              -----------  -----------
          Total liabilities and stockholders'
           equity                            $ 1,196,970  $ 1,175,880
                                              ===========  ===========

(1) Certain reclassifications have been made in prior years' periods
    to conform to the current period presentations.



           Oregon Steel Mills, Inc. and Subsidiary Companies
                         Calculation of EBITDA
                            (In thousands)
                              (Unaudited)

                                                       Three Months
                                                          Ended
                                                         March 31,
                                                      ----------------
                                                       2006    2005
                                                      ----------------

Net income                                            $33,351 $28,350
 Income tax expense                                    19,126  16,006
                                                      ----------------
Pre-tax income                                        $52,477 $44,356

Add back:
 Interest expense                                       8,262   8,924
 Interest capitalized                                  (1,275)   (282)
 Depreciation                                          10,811   9,691
 Amortization                                              39      40
                                                      ----------------
EBITDA                                                $70,314 $62,729
                                                      ================
*T

   EBITDA is a non-generally accepted accounting principles ("GAAP")
measure. The Company believes that EBITDA is useful to investors
because it is a basis upon which we assess our financial performance,
it provides useful information regarding our ability to service our
debt and because it is a commonly used financial analysis tool for
measuring and comparing companies in several areas of liquidity,
operating performance and leverage. The Company believes EBITDA,
excluding the effects of special items, is useful to investors because
the Company believes the excluded items are nonrecurring. Therefore,
the Company believes this financial measure is more useful to
investors when comparing the reported results to previous periods.