Exhibit 99.1
NEWS
RELEASE
CONTACT: RICHARD T. MARABITO
CHIEF FINANCIAL OFFICER
TELEPHONE: (216) 292-3800
FAX: (216) 292-3974
OLYMPIC STEEL REPORTS RECORD SALES AND EARNINGS FOR FIRST QUARTER OF 2004
Cleveland, Ohio -- (April 29, 2004) Olympic Steel, Inc., (Nasdaq: ZEUS), a
national steel service center, today announced record financial results for the
first quarter ended March 31, 2004.
Net sales for the first quarter of 2004 increased 62.8% to a record $187.0
million from $114.9 million for the first quarter a year ago. Tons sold
increased 43.2% to a record 385 thousand from 269 thousand in the first quarter
of 2003. First quarter 2004 net income was also the highest ever for the
Company, totaling $10.8 million, or $1.12 per share, compared to a net loss of
$(479) thousand, or $(.05) per share for last year's first quarter.
"The diligent execution of our management plans positioned us extremely
well during the first quarter, when steel demand and prices increased
significantly," stated Michael D. Siegal, Chairman and Chief Executive Officer.
"We are very pleased with our ability to perform and grow during a period of
very tight steel supply. As indicated in our fourth quarter earnings release, in
anticipation of a market recovery we aggressively and intentionally increased
our inventory position at the end of 2003. This allowed us to be favorably
inventoried to meet our customers' significantly increasing demand for steel
during the first quarter. Our 43.2% increase in shipping volumes for the first
quarter far outpaced the service center industry increase of approximately 25%.
The increased volume of steel processed through our assets was a significant
contributor to our best ever quarterly financial results."
"Our commercial relationships will continue to be guided by our core
values of integrity, respect and financial stability, as we expect customer
demand to remain strong, prices to remain elevated, and availability of steel to
be tight through the second quarter. We believe we are favorably positioned in
terms of inventory, equipment capacity, and working capital availability to
continue performing well through the seasonally stronger second quarter,"
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.
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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,
---------------------------
2004 2003
--------- ---------
(unaudited)
SUMMARY RESULTS OF OPERATIONS:
Net sales $ 187,033 $ 114,880
Operating income 18,835 379
Income (loss) before income taxes 17,495 (798)
--------- ---------
Net income (loss) $ 10,847 $ (479)
========= =========
Earnings per share:
Net income (loss) per share - basic $ 1.12 $ (0.05)
Net income (loss) per share - diluted $ 1.09 $ (0.05)
AS OF MARCH 31,
----------------------- DECEMBER 31,
2004 2003 2003
-------- -------- --------
(unaudited)
SUMMARY BALANCE SHEET DATA:
Accounts receivable, net $ 82,319 $ 59,167 $ 56,501
Inventories 94,739 92,435 92,775
Net property and equipment 87,787 95,331 89,782
Total assets 278,056 258,982 249,002
Current liabilities 51,562 35,666 42,574
Total debt 100,006 109,080 97,797
Shareholders' equity 123,266 115,024 112,236
Shareholders' equity per share 12.77 11.93 11.63
Debt-to-equity ratio .81 to 1 .95 to 1 .87 to 1
THREE MONTHS ENDED
MARCH 31,
--------------------------
2004 2003
------ ------
(unaudited)
OTHER DATA:
Capital expenditures 107 95
EBITDA (a) 21,206 2,466
(a) Defined as operating income plus depreciation plus asset impairment charge.
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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OLYMPICSTEEL
RESULTS OF OPERATIONS
(in thousands, except per share and tonnage data)
THREE MONTHS ENDED MARCH 31,
----------------------------
2004 2003
-------------------------------- -----------------------------
(unaudited)
Tons sold
Direct 330,095 229,501
Toll 55,049 39,434
--------- ---------
385,144 268,935
% change 43.2% (13.0%)
Net sales $ 187,033 $ 114,880
% change 62.8% 4.2%
Cost of materials sold 133,546 90,987
--------- ---------
Gross profit 53,487 28.6% 23,893 20.8%
Operating expenses
Warehouse and processing 10,884 5.8% 7,988 7.0%
Administrative and general 9,677 5.2% 5,808 5.1%
Distribution 5,071 2.7% 3,764 3.3%
Selling 5,316 2.8% 2,754 2.4%
Occupancy 1,333 0.7% 1,113 1.0%
Depreciation 2,071 1.1% 2,087 1.8%
Asset impairment charge 300 0.2% -- 0.0%
--------- ---------
Total operating expenses 34,652 18.5% 23,514 20.5%
--------- ---------
Operating income 18,835 10.1% 379 0.3%
Income (loss) from joint ventures 78 (29)
--------- ---------
Income before financing costs and income taxes 18,913 350
Interest and other expense on debt 1,418 0.8% 1,148 1.0%
--------- ---------
Income (loss) before income taxes 17,495 9.4% (798) (0.7%)
Income tax benefit (provision) (6,648) 38.0% 319 40.0%
--------- ---------
Net income (loss) $ 10,847 $ (479)
========= =========
Earnings per share:
Net income (loss) per share - basic $ 1.12 $ (0.05)
========= =========
Weighted average shares outstanding - basic 9,675 9,644
========= =========
Net income (loss) per share - diluted $ 1.09 $ (0.05)
========= =========
Weighted average shares outstanding - diluted 9,959 9,644
========= =========
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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