Roanoke Electric Steel (NASDAQ:RESC)
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Roanoke Electric Steel Corporation Reports Record First Quarter
Results
ROANOKE, Va., March 7 /PRNewswire-FirstCall/ -- Roanoke Electric Steel
Corporation (NASDAQ:RESC) today reported record first quarter net earnings of
$9,185,874 for the period ended January 31, 2005, compared to net earnings of
$1,533,676 for the same period last year. Basic earnings per share for the
quarter were $.83 ($.82 diluted), compared to basic earnings per share of $.14
($.14 diluted) in the first quarter of 2004. Sales for the quarter were
$131,309,983, also a first quarter record and up 54.2% from sales of
$85,173,685 for the same period last year.
Donald G. Smith, Chairman and CEO, and T. Joe Crawford, President and COO,
stated:
"We are very pleased to report that earnings for the first quarter of fiscal
2005 were the highest first quarter earnings in the history of our company.
While the first quarter has historically been the most challenging for our
company, due to the holidays and weather issues, to begin fiscal 2005 by
establishing a new earnings record for the quarter is extremely gratifying. The
improved performance for the quarter was, primarily, due to increased margins
for mill products, as demand continued to be strong. The improved margins were
attributable to increased selling prices. The cost of scrap metal, our
principal raw material, appears to have stabilized, although it remains near
historical highs.
"The performance from continuing operations for the first quarter of 2005 over
2004 was even stronger when taking into account two unusual items. First,
included in the 2005 quarter is the charge associated with the sale of the
assets of RESCO Steel Products Corporation, a reinforcing bar fabrication
operation which was no longer a good strategic fit for the Company. Second, in
the 1st quarter of 2004, we had the benefit of approximately $1,400,000 of
additional earnings associated with the graphite electrode class action
settlement, which was not present in 2005. In the absence of these two items,
the improvement in earnings from continuing operations was over $9,600,000.
"Looking forward to the balance of fiscal 2005, we anticipate that the forces
driving our markets will continue to present healthy price levels and demand
for our products. The nonresidential construction market which began to show
improvements in the second quarter of last year continues to improve, and we
are optimistic that the trend will continue."
(Unaudited)
Three Months Ended
January 31,
2005 2004
SALES $131,309,983 $85,173,685
COST OF SALES 102,714,466 76,501,378
GROSS EARNINGS 28,595,517 8,672,307
OTHER OPERATING EXPENSES (INCOME)
Administrative 7,844,436 6,965,793
Interest expense 851,203 1,122,938
Profit sharing 3,551,807 999,391
Interest income (21,982) (75,256)
Antitrust litigation settlement --- (3,061,820)
Total 12,225,464 5,951,046
EARNINGS FROM CONTINUING OPERATIONS
BEFORE INCOME TAXES 16,370,053 2,721,261
INCOME TAX EXPENSE 6,506,538 1,084,617
EARNINGS FROM CONTINUING OPERATIONS 9,863,515 1,636,644
DISCONTINUED OPERATIONS
LOSS FROM OPERATIONS OF DISCONTINUED
OPERATIONS (INCLUDING LOSS ON SALE) (1,118,263) (171,613)
INCOME TAX BENEFIT (440,622) (68,645)
LOSS ON DISCONTINUED OPERATIONS (677,641) (102,968)
NET EARNINGS $9,185,874 $1,533,676
Earnings (loss) per share of common stock:
Earnings from continuing
operations:
Basic $0.89 $0.15
Diluted $0.88 $0.15
Loss on discontinued operations:
Basic (0.06) (0.01)
Diluted (0.06) (0.01)
Net earnings per share of
common stock:
Basic $0.83 $0.14
Diluted $0.82 $0.14
Cash dividends per share of common stock $0.11 $0.05
Weighted average number of common
shares outstanding:
Basic 11,038,710 10,932,813
Diluted 11,177,438 10,970,133
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 statements,
the Company notes that a variety of factors, including economic and industry
conditions, availability and prices of utilities, supplies and raw materials,
prices of steel products, foreign and domestic competition, trade policies
affecting imports and exports, governmental regulations, interest rates,
inflation, labor relations, environmental concerns and compliance issues and
other matters, could cause actual results and experience to differ materially
from those expressed in the forward-looking statements.
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 and bar joists and truck trailer beam
fabrication.
DATASOURCE: Roanoke Electric Steel Corporation
CONTACT: Mark G. Meikle, or William M. Watson, Jr., of Roanoke Electric
Steel Corporation, +1-504-342-1831
Web site: http://www.roanokesteel.com/