Exhibit 99.1
Olympic Steel Reports 2007 First Quarter Sales and Earnings Results
CLEVELAND--(BUSINESS WIRE)--April 27, 2007--Olympic Steel, Inc.,
(Nasdaq:ZEUS), a national steel service center, today announced its financial
results for the first quarter of 2007.
Net sales for the first quarter of 2007 totaled $259.4 million, an 8.6%
increase from the $238.9 million for the first quarter a year ago. First quarter
2007 net income totaled $5.3 million, or $0.49 per diluted share, compared to
net income of $8.0 million, or $0.76 per diluted share for last year's first
quarter. Tons sold decreased 7.9% to 312 thousand from 338 thousand in the first
quarter of 2006, in line with the Metals Service Center Institute statistics of
a 7.4% decline in year-over-year flat rolled shipments for the first quarter of
2007.
Olympic Steel's Board of Directors approved a regular quarterly cash
dividend of $.03 per share to be paid to shareholders of record as of June 1,
2007, and distributed on June 15, 2007.
Commenting on the results, Chairman and Chief Executive Officer Michael D.
Siegal, stated, "We are pleased to report improved sales and earnings
performance over the fourth quarter of 2006. The first quarter carbon steel
market was quite challenging, as the year began with high inventories at steel
service centers, causing a very competitive landscape."
"Looking forward, carbon imports continue to be low, steel-making input
costs such as scrap and pellets have risen, service center inventories are now
at more balanced levels, and demand appears to be slowly recovering, leading to
a potential improving price and earnings environment for the second quarter of
2007. On a longer-term view, we are increasing our capital spending in new
equipment, facilities and technology solutions to support future growth. In
2007, we have placed orders for a new Red Bud stretcher leveler cut-to-length
line in Minneapolis, and new laser, plasma, and machining equipment in Cleveland
and Chambersburg to support our growing value-add services. We have also broken
ground on an expansion to our existing Iowa facility, and our previously
announced new IT system project is proceeding on plan," concluded Mr. Siegal.
A simulcast of Olympic Steel's 2007 first quarter earnings conference call
may be accessed via the Investor Relations section of the Company's website at
www.olysteel.com. The simulcast will begin at 10:00 a.m. Eastern Time today and
a replay of the call will be available for 14 days thereafter.
Founded in 1954, Olympic Steel is a leading U.S. steel service center
focused on the direct sale and distribution of large volumes of processed
carbon, coated and stainless flat-rolled sheet, coil and plate steel products.
Headquartered in Cleveland, Ohio, the Company operates 16 facilities. For
further information, visit the Company's web site at http://www.olysteel.com.
It is the Company's policy 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.
Forward-looking statements are typically identified by words or phrases such as
"may," "will," "should," "expect," "anticipate," "intend," "plan," "believe,"
"estimate," "potential," or "continue," as well as the negative of these terms
or other similar expressions. 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.
Such risks and uncertainties include, but are not limited to: general and
global business, economic and political conditions; competitive factors such as
the availability and pricing of steel, industry inventory levels, and rapid
fluctuations in customer demand and pricing; the cyclicality and volatility
within the steel industry; the ability of customers (especially in the
automotive industry) to maintain their credit availability; layoffs or work
stoppages by the Company's, suppliers' or customers' personnel; the availability
and cost of transportation and logistical services; equipment installation
delays or malfunctions; the successes of the Company's capital investments,
efforts and initiatives to increase sales volumes, improve cash flows and reduce
debt, maintain or improve inventory turnover, and reduce costs; the timing and
outcome of efforts and ability to liquidate OLP's remaining assets; the adequacy
of our existing information technology and business system software and the
success of implementing our new information system; customer, supplier, and
competitor consolidation or insolvency; the post-acquisition integration of PS&W
and the Company's ability to pay regular quarterly cash dividends. Further
information on these and other risks and uncertainties is provided under Item 1A
"Risk Factors" of the Company's Annual Report on Form 10-K and Quarterly Reports
on Form 10-Q, which disclosure is incorporated herein by reference, and
elsewhere in reports that the Company files or furnishes with the SEC. This
release speaks only as of its date and the Company undertakes no obligation to
publicly update forward-looking statements, whether as a result of new
information, future events or otherwise, except to the extent required by law.
You are advised, however, to consult any further disclosures the Company makes
on related subjects in its reports filed with or furnished to the SEC.
OLYMPIC STEEL
SELECTED FINANCIAL INFORMATION
(in thousands, except per share data and ratios)
Three Months Ended
March 31,
-------------------
2007 2006
--------- ---------
SUMMARY RESULTS OF OPERATIONS: (unaudited)
- -------------------------------------
Net sales $259,405 $238,871
Operating income 9,410 12,834
Income before income taxes 8,383 12,573
--------- ---------
Net income $ 5,252 $ 7,981
========= =========
Earnings per share:
Net income per share - basic $ 0.50 $ 0.78
Net income per share - diluted $ 0.49 $ 0.76
March 31,
------------------- December 31,
2007 2006 2006
--------- --------- ------------
SUMMARY BALANCE SHEET DATA: (unaudited)
- -------------------------------------
Accounts receivable, net $109,135 $ 99,383 $ 85,883
Inventories 189,988 137,408 210,738
Net property and equipment 87,270 81,973 87,359
Total assets 408,829 327,848 405,320
Current liabilities 111,567 95,853 92,340
Total debt 50,247 10,000 68,328
Shareholders' equity 239,439 211,487 234,237
Shareholders' equity per share 22.92 20.34 22.46
Debt-to-equity ratio .21 to 1 .05 to 1 .29 to 1
Three Months Ended
March,
-------------------
2007 2006
--------- ---------
OTHER DATA: (unaudited)
- -------------------------------------
Capital expenditures 2,093 6,230
Cash dividends per share $ 0.03 $ 0.03
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.
OLYMPIC STEEL
RESULTS OF OPERATIONS
(in thousands, except per share and tonnage data)
Three Months Ended March 31,
-------------------------------
2007 2006
--------------- ---------------
(unaudited)
Tons sold
Direct 273,326 281,805
Toll 38,263 56,363
--------- ---------
311,589 338,168
% change (7.9%) (6.0%)
Net sales $259,405 $238,871
% change 8.6% (16.1%)
Costs and expenses
Cost of materials sold (exclusive
of depreciation shown below) 212,031 81.7% 191,713 80.3%
Warehouse and processing 13,675 5.3% 11,637 4.9%
Administrative and general 10,264 4.0% 9,304 3.9%
Distribution 6,309 2.4% 6,248 2.6%
Selling 3,781 1.5% 3,436 1.4%
Occupancy 1,753 0.7% 1,691 0.7%
Depreciation 2,182 0.8% 2,008 0.8%
--------- ---------
Total costs and expenses 249,995 96.4% 226,037 94.6%
--------- ---------
Operating income 9,410 3.6% 12,834 5.4%
Loss from joint ventures - (107)
--------- ---------
Income before financing costs and
income taxes 9,410 12,727
Interest and other expense on debt 1,027 0.4% 154 0.1%
--------- ---------
Income before income taxes 8,383 3.2% 12,573 5.3%
Income tax provision 3,131 37.3% 4,592 36.5%
--------- ---------
Net income $ 5,252 $ 7,981
========= =========
Earnings per share:
Net income per share - basic $ 0.50 $ 0.78
========= =========
Weighted average shares outstanding
- basic 10,435 10,259
========= =========
Net income per share - diluted $ 0.49 $ 0.76
========= =========
Weighted average shares outstanding
- diluted 10,664 10,568
========= =========
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.
CONTACT: Olympic Steel, Inc.
Richard T. Marabito, Chief Financial Officer
216-292-3800
Fax: 216-292-3974