Roanoke Electric Steel (NASDAQ:RESC)
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Roanoke Electric Steel Corporation Reports Quarterly Profit and Improved Fiscal
2003 Results
ROANOKE, Va., Dec. 4 /PRNewswire-FirstCall/ -- Roanoke Electric Steel
Corporation reported a profit of $700,735 for the fourth quarter ended October
31, 2003, compared to a loss of $315,374 for the same period last year. The
results for the quarter represented the first quarterly profit since July 2001,
following eight consecutive quarterly losses. Basic earnings per share were
$.06, compared to basic loss per share of $.03 last year. Sales for the quarter
were $91,600,033, a 27.3% increase from sales of $71,935,383 reported for the
2002 fourth quarter.
For the year ended October 31, 2003, the Company reported a loss of $3,224,953,
compared to a loss of $6,008,897 for the 2002 fiscal year, or an improvement of
46.3%. Basic loss per share for the year was $.29, compared to basic loss per
share of $.55 last year. The 2003 results included a $228,410 charge for the
cumulative effect of a change in accounting principle, which amounted to $.02
per share. Sales for fiscal 2003 were $312,090,956, up 18.3% from $263,773,709
reported last year.
Donald G. Smith, Chairman and Chief Executive Officer, stated:
"Roanoke Electric Steel achieved significantly improved results in a very
challenging year, realizing quarterly improvements throughout the 2003 fiscal
year. A general upturn in our overall markets led to an increase in the number
of tons both produced and shipped during the year, resulting in a sales increase
of 18.3% in 2003 over 2002. Selling prices for our products increased initially
due to rising scrap costs, which prompted several industry-wide price increases.
Recently, demand has improved, further augmenting the rise of selling prices.
In fact, selling prices during the year for merchant bar products increased
18.8%, for specialty steel products increased 8.8% and for billets increased
11.3%. In addition, mill operating rates, productivity and efficiencies
improved throughout the year.
"As we begin fiscal 2004, business conditions appear to be improving in certain
markets, as many of our customers are busier than they have been in the recent
past. Prices continue to increase, with two additional increases effective in
November and December 2003 for many of the products we produce. We are hopeful
that the positive momentum established in 2003 continues in 2004."
Consolidated Statements of Earnings (Loss)
Three Months Ended Year Ended
October 31, October 31,
2003 2002 2003 2002
SALES $91,600,033 $71,935,383 $312,090,956 $263,773,709
COST OF SALES 81,115,675 65,984,871 288,000,605 246,172,654
GROSS EARNINGS 10,484,358 5,950,512 24,090,351 17,601,055
OTHER OPERATING
EXPENSES (INCOME)
Administrative 6,967,014 5,643,267 23,285,533 22,543,027
Interest, net 1,249,174 1,323,420 5,001,906 5,497,761
Profit sharing 1,078,691 581,781 1,309,091 658,699
Antitrust
litigation
settlement --- --- (520,960) ---
Officer life
insurance
proceeds --- (630,000) --- (630,000)
Total 9,294,879 6,918,468 29,075,570 28,069,487
EARNINGS (LOSS)
BEFORE INCOME
TAXES AND
CUMULATIVE EFFECT
OF CHANGE IN
ACCOUNTING
PRINCIPLE 1,189,479 (967,956) (4,985,219) (10,468,432)
INCOME TAX EXPENSE
(BENEFIT) 488,744 (652,582) (1,988,676) (4,459,535)
EARNINGS (LOSS)
BEFORE CUMULATIVE
EFFECT OF CHANGE
IN ACCOUNTING
PRINCIPLE 700,735 (315,374) (2,996,543) (6,008,897)
CUMULATIVE EFFECT OF
CHANGE IN ACCOUNTING
PRINCIPLE --- --- (228,410) ---
NET EARNINGS (LOSS) $700,735 $(315,374) $(3,224,953) $(6,008,897)
Net earnings (loss)
per share (basic
and diluted) of
common stock:
Earnings (loss)
before cumulative
effect of change
in accounting
principle $0.06 $(0.03) $(0.27) $(0.55)
Cumulative effect
of change in
accounting
principle --- --- (0.02) ---
Net earnings (loss)
per share of
common stock $0.06 $(0.03) $(0.29) $(0.55)
Cash dividends per
share of common stock $0.05 $0.05 $0.20 $0.35
Weighted average
number of common
shares
outstanding:
Basic 10,932,813 10,942,813 10,938,999 10,934,380
Diluted 10,946,104 10,958,412 10,945,346 10,967,904
This release contains various forward-looking statements which represent the
Company's expectations or beliefs concerning future events. In accordance with
the safe harbor provisions of the securities laws regarding such forward-
looking statements, the Company notes that a variety of factors could cause
actual results and experience to differ materially from those expressed in the
forward-looking statements. The risks and uncertainties that may affect the
operations, performance, development and results of the Company's business
include economic and industry conditions, timing of the recovery within our
steel markets, availability and prices of utilities, supplies and raw materials,
prices of steel products, foreign and domestic competition, foreign trade
polices affecting imports and exports, governmental regulations, interest rates,
inflation, labor relations, environmental concerns and compliance issues and
others.
Roanoke Electric Steel Corporation has steel manufacturing facilities in
Roanoke, Virginia and Huntington, West Virginia, producing angles, rounds,
flats, channels, beams, special sections and billets, which are sold to steel
service centers, fabricators, original equipment manufacturers and other steel
producers. Four subsidiaries are involved in various steel-related activities,
consisting of scrap processing, bar joist fabrication and reinforcing bar
fabrication.
DATASOURCE: Roanoke Electric Steel Corporation
CONTACT: T. Joe Crawford of Roanoke Electric Steel Corporation,
+1-540-342-1831
Web site: http://www.roanokesteel.com/