EXHIBIT 99.3
NEWS CONTACT: RICHARD T. MARABITO
r e l e a s e CHIEF FINANCIAL OFFICER
TELEPHONE: (216) 292-3800
FAX: (216) 682-4065
OLYMPIC STEEL REPORTS FIRST QUARTER 2003 RESULTS
Cleveland, Ohio -- (May 8, 2003) Olympic Steel, Inc., (Nasdaq: ZEUS), a
national steel service center, today announced financial results for the first
quarter ended March 31, 2003.
Net sales for the first quarter of 2003 increased 4.2% to $114.9
million from $110.2 million. Tons sold decreased 13% to 269 thousand from 309
thousand in the first quarter of 2002. Net loss was $479 thousand, or $.05 per
share, compared to a net loss of $1.9 million, or $.20 per share for last year's
first quarter. Operating income totaled $379 thousand, compared to $2.3 million
for the prior year period. First quarter results in 2002 included losses from
the Company's discontinued Tubing operation and the cumulative effect of a
change in accounting principle for goodwill.
"Customer demand for flat-rolled steel was unusually weak in the first
quarter," stated Michael D. Siegal, Chairman and Chief Executive Officer. "Our
results were also impacted by lower gross profits, due to the soft demand
coupled with selling higher-priced steel purchased during tight supply
conditions in 2002. In response to the challenging market environment, we
quickly reduced our inventory by 9%, reduced employment by another 8%,
implemented additional cost cutting measures, and refinanced our debt with a
lower rate credit facility in the first quarter of 2003. Although business
conditions are not expected to improve in the second quarter, we remain
committed to aggressively managing our balance sheet, cash flows, and operating
expenses," concluded Mr. Siegal.
Founded in 1954, Olympic Steel is a North American steel service center
that is experienced in the specialized processing and distribution of large
volumes of flat-rolled carbon and stainless steel products. Headquartered in
Cleveland, Ohio, the Company operates 12 distribution and processing facilities
and participates in two joint ventures in Michigan. For further information
about Olympic Steel, Inc., visit the Company's web site at
http://www.olysteel.com.
It is the Company's policy not to make quarterly or annual sales or
earnings projections for external use and not to endorse any analyst's sales or
earnings estimates. 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 certain risks and
uncertainties that could cause actual results to differ materially from those
projected. Readers are cautioned not to place undue reliance on these
forward-looking statements that speak only as of the date hereof. Such risks and
uncertainties include, but are not limited to: general business, economic and
political conditions; competitive factors such as the availability and pricing
of steel and fluctuations in customer demand; layoffs or work stoppages by the
Company's, suppliers', or customers' personnel; equipment installation delays or
malfunctions; and customer, supplier, and competitor consolidation or
insolvency. Please refer to the Company's Securities and Exchange Commission
filings for further information.
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OLYMPICSTEEL
SELECTED FINANCIAL INFORMATION
(in thousands, except per share data and ratios)
THREE MONTHS ENDED
MARCH 31,
-------------------------------
2003 2002
------------- ------------
SUMMARY RESULTS OF OPERATIONS: (unaudited)
- ------------------------------
Net sales $114,880 $ 110,239
Operating income 379 2,270
Income (loss) from continuing operations before income taxes
and cumulative effect of a change in accounting principle (798) 735
Income (loss) from continuing operations before cumulative
effect of a change in accounting principle (479) 452
Loss from discontinued operations, net of income taxes -- (250)
Cumulative effect of a change in accounting principle, net
of income taxes -- (2,117)
-------- ---------
Net loss $ (479) $ (1,915)
======== =========
Basic and diluted net income (loss) per share:
Income (loss) from continuing operations $ (0.05) $ 0.05
Loss from discontinued operations -- (0.03)
Cumulative effect of a change in accounting principle -- (0.22)
-------- ---------
Net loss per share $ (0.05) $ (0.20)
======== =========
AS OF MARCH 31, DECEMBER 31,
------------------------------- ------------
2003 2002 2002
------------- ------------ ------------
SUMMARY BALANCE SHEET DATA: (unaudited)
- ---------------------------
Accounts receivable, net $ 59,167 $ 55,825 $ 48,877
Inventories 92,435 70,604 101,837
Net property and equipment 95,331 109,319 97,323
Total assets 258,982 245,153 262,911
Current liabilities 35,666 37,954 43,962
Total debt 109,080 93,332 106,793
Shareholders' equity 115,024 119,331 115,495
Shareholders' equity per share 11.93 12.39 11.98
Debt-to-equity ratio .95 to 1 .78 to 1 .92 to 1
THREE MONTHS ENDED
MARCH 31,
-------------------------------
2003 2002
------------- ------------
OTHER DATA: (unaudited)
- -----------
Capital expenditures 95 449
EBITDA (a) 2,466 4,408
(a) Defined as operating income plus depreciation.
CERTAIN 2002 AMOUNTS HAVE BEEN RECLASSIFIED TO CONFORM TO THE 2003 PRESENTATION.
IT IS THE COMPANY'S POLICY NOT TO MAKE QUARTERLY OR ANNUAL SALES OR EARNINGS PROJECTIONS
FOR EXTERNAL USE AND NOT TO ENDORSE ANY ANALYST'S SALES OR EARNINGS ESTIMATES.
PAGE 2 OF 3
OLYMPICSTEEL
RESULTS OF OPERATIONS
(in thousands, except per share and tonnage data)
Three Months Ended March 31,
------------------------------------------
2003 2002
------------------- -------------------
(unaudited)
Tons sold
Direct 229,501 268,725
Toll 39,434 40,367
----------- -----------
268,935 309,092
% change (13.0%) 10.1%
Net sales $ 114,880 $ 110,239
% change 4.2% (2.9%)
Cost of materials sold 90,987 82,094
----------- -----------
Gross profit 23,893 20.8% 28,145 25.5%
Operating expenses
Warehouse and processing 7,988 7.0% 8,929 8.1%
Administrative and general 5,808 5.1% 6,188 5.6%
Distribution 3,764 3.3% 4,288 3.9%
Selling 2,754 2.4% 3,293 3.0%
Occupancy 1,113 1.0% 1,039 0.9%
Depreciation 2,087 1.8% 2,138 1.9%
----------- -----------
Total operating expenses 23,514 20.5% 25,875 23.5%
----------- -----------
Operating income 379 0.3% 2,270 2.1%
Income (loss) from joint ventures (29) 192
----------- -----------
Income before financing costs and income taxes 350 2,462
Interest and other expense on debt 1,148 1.0% 1,727 1.6%
----------- -----------
Income (loss) from continuing operations before income taxes and
cumulative effect of a change in accounting principle (798) (0.7%) 735 0.7%
Income tax benefit (provision) 319 40.0% (283) 38.5%
----------- -----------
Income (loss) from continuing operations before cumulative effect
of a change in accounting principle (479) 452
Discontinued operations:
Loss from discontinued tube operation, net of income tax benefit
of $156 in 2002 -- (250)
----------- -----------
Income (loss) before cumulative effect of a change in accounting principle (479) 202
Cumulative effect of a change in accounting principle, net of income
tax benefit of $1,298 in 2002 -- (2,117)
----------- -----------
Net loss $ (479) $ (1,915)
=========== ===========
Basic and diluted net income (loss) per share:
Income (loss) from continuing operations $ (0.05) $ 0.05
Loss from discontinued operations -- (0.03)
Cumulative effect of a change in accounting principle -- (0.22)
----------- -----------
Net loss per share $ (0.05) $ (0.20)
=========== ===========
Weighted average shares outstanding 9,644 9,631
CERTAIN 2002 AMOUNTS HAVE BEEN RECLASSIFIED TO CONFORM TO THE 2003 PRESENTATION.
IT IS THE COMPANY'S POLICY NOT TO MAKE QUARTERLY OR ANNUAL SALES OR EARNINGS PROJECTIONS
FOR EXTERNAL USE AND NOT TO ENDORSE ANY ANALYST'S SALES OR EARNINGS ESTIMATES.
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