Exhibit 99.1
Olympic Steel Reports 2007 Second
Quarter Sales and Earnings Results
CLEVELAND--(BUSINESS WIRE)--Aug. 3, 2007--Olympic Steel, Inc.,
(Nasdaq:ZEUS), a national steel service center, today announced its
financial results for the second quarter of 2007.
Net sales for the second quarter of 2007 totaled $277.4 million,
an 8.3% increase from the $256.2 million for the second quarter a year
ago. Second quarter 2007 net income totaled $9.4 million, or $0.88 per
diluted share, compared to net income of $8.4 million, or $0.79 per
diluted share for last year's second quarter. Tons sold decreased 1.9%
to 336 thousand from 343 thousand in the second quarter of 2006.
Net sales for the first half of 2007 increased 8.4% to $536.8
million, compared to last year's first half net sales of $495.0
million. Net income for the first half of 2007 totaled $14.7 million
or $1.37 per diluted share, compared to $16.4 million, or $1.54 per
diluted share for last year's first half. Tons sold in the first half
decreased 4.9% to 648 thousand from 681 thousand in the first half of
2006, better than the Metals Service Center Institute statistics of a
8.7% decline in year-over-year flat rolled shipments for the first
half of 2007.
Olympic Steel's Board of Directors approved a regular quarterly
cash dividend of $.04 per share to be paid to shareholders of record
as of September 3, 2007, and distributed on September 17, 2007. This
represents an increase of $.01 per share from the previous regular
quarterly dividends paid by the Company.
Commenting on the results, Chairman and Chief Executive Officer
Michael D. Siegal, stated, "We are pleased to report improved sales
and earnings performance over both the first quarter of 2007 and the
second quarter of 2006. Aside from the slowness in domestic automotive
steel consumption and in sales to other service centers, where we
experienced our entire decline in 2007 volume, we remain optimistic
about the steel industry and the opportunities for Olympic Steel to
create additional value for our shareholders during the remainder of
the year. Carbon imports remain low, and service center inventories
were reduced for the eighth consecutive month in June 2007, leading to
a potentially improving sales and earnings environment when demand is
restored from the current seasonal summer slowdown. With the strength
of our balance sheet and our 0.25 to 1 debt-to-equity ratio, we are
increasing investments in new equipment, facilities and information
technology. In the first half of 2007, we have spent $5.5 million on
capital projects in process, including a new stretcher leveler for our
Minneapolis Coil facility, an expansion to our Iowa facility, the
implementation of a new information system, and the purchase of
several new laser, plasma and machining centers to support our growth
in value-add processing and gross margin expansion," concluded Mr.
Siegal.
A simulcast of Olympic Steel's 2007 second 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.
- -0-
OLYMPIC STEEL
SELECTED FINANCIAL INFORMATION
(in thousands, except per share data and ratios)
Three Months Ended Six Months Ended
June 30, June 30,
------------------- ----------------------
2007 2006 2007 2006
--------- --------- ------------ ---------
SUMMARY RESULTS OF (unaudited) (unaudited)
OPERATIONS:
- ---------------------------
Net sales $ 277,413 $ 256,155 $ 536,818 $ 495,026
Operating income 15,871 16,042 25,281 28,876
Income before income taxes 15,018 13,667 23,401 26,240
--------- --------- ------------ ---------
Net income $ 9,446 $ 8,371 $ 14,698 $ 16,352
========= ========= ============ =========
Earnings per share:
Net income per share -
basic $ 0.89 $ 0.80 $ 1.40 $ 1.58
Net income per share -
diluted $ 0.88 $ 0.79 $ 1.37 $ 1.54
June 30,
-------------------
December 31,
2007 2006 2006
--------- --------- ------------
SUMMARY BALANCE SHEET DATA: (unaudited)
- ---------------------------
Accounts receivable, net $ 120,600 $ 108,196 $ 85,883
Inventories 197,021 172,379 210,738
Net property and equipment 88,516 87,552 87,359
Total assets 437,416 386,641 405,320
Current liabilities 108,438 112,926 92,340
Total debt 64,296 44,479 68,328
Shareholders' equity 253,118 220,119 234,237
Shareholders' equity per
share 23.65 21.11 22.46
Debt-to-equity ratio .25 to 1 .20 to 1 .29 to 1
Six Months Ended
June 30,
-------------------
2007 2006
--------- ---------
OTHER DATA: (unaudited)
- ---------------------------
Capital expenditures 5,509 8,127
Cash dividends per share $ 0.06 $ 0.06
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.
- -0-
OLYMPIC STEEL
RESULTS OF OPERATIONS
(in thousands, except per share and tonnage data)
Three Months Ended June 30,
-----------------------------
2007 2006
-------------- --------------
(unaudited)
Tons sold
Direct 296,849 287,810
Toll 39,276 54,775
-------- --------
336,125 342,585
% change (1.9%) 7.5%
Net sales $277,413 $256,155
% change 8.3% 6.1%
Costs and expenses
Cost of materials sold (exclusive of
depreciation shown below) 221,729 79.9% 202,795 79.2%
Warehouse and processing 14,272 5.1% 13,657 5.3%
Administrative and general 11,271 4.1% 9,743 3.8%
Distribution 6,464 2.3% 6,953 2.7%
Selling 4,185 1.5% 3,597 1.4%
Occupancy 1,451 0.5% 1,272 0.5%
Depreciation 2,170 0.8% 2,096 0.8%
-------- --------
Total costs and expenses 261,542 94.3% 240,113 93.7%
-------- --------
Operating income 15,871 5.7% 16,042 6.3%
Loss from joint ventures - (30)
Loss from disposition of joint venture - (2,000)
-------- --------
Income before financing costs and
income taxes 15,871 14,012
Interest and other expense on debt 853 0.3% 345 0.1%
-------- --------
Income before income taxes 15,018 5.4% 13,667 5.3%
Income tax provision 5,572 37.1% 5,296 38.8%
-------- --------
Net income $ 9,446 $ 8,371
======== ========
Earnings per share:
Net income per share - basic $ 0.89 $ 0.80
======== ========
Weighted average shares outstanding
- basic 10,603 10,416
======== ========
Net income per share - diluted $ 0.88 $ 0.79
======== ========
Weighted average shares outstanding
- diluted 10,753 10,661
======== ========
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)
Six Months Ended June 30,
------------------------------
2007 2006
--------------- --------------
(unaudited)
Tons sold
Direct 570,175 569,615
Toll 77,539 111,139
--------- --------
647,714 680,754
% change (4.9%) 0.3%
Net sales $536,818 $495,026
% change 8.4% (5.9%)
Costs and expenses
Cost of materials sold (exclusive of
depreciation shown below) 433,760 80.8% 394,508 79.7%
Warehouse and processing 27,947 5.2% 25,294 5.1%
Administrative and general 21,535 4.0% 19,047 3.8%
Distribution 12,773 2.4% 13,201 2.7%
Selling 7,966 1.5% 7,033 1.4%
Occupancy 3,204 0.6% 2,963 0.6%
Depreciation 4,352 0.8% 4,104 0.8%
--------- --------
Total costs and expenses 511,537 95.3% 466,150 94.2%
--------- --------
Operating income 25,281 4.7% 28,876 5.8%
Loss from joint ventures - (137)
Loss from disposition of joint venture - (2,000)
--------- --------
Income before financing costs and
income taxes 25,281 26,739
Interest and other expense on debt 1,880 0.4% 499 0.1%
--------- --------
Income before income taxes 23,401 4.4% 26,240 5.3%
Income tax provision 8,703 37.2% 9,888 37.7%
--------- --------
Net income $ 14,698 $ 16,352
========= ========
Earnings per share:
Net income per share - basic $ 1.40 $ 1.58
========= ========
Weighted average shares outstanding -
basic 10,527 10,338
========= ========
Net income per share - diluted $ 1.37 $ 1.54
========= ========
Weighted average shares outstanding -
diluted 10,716 10,615
========= ========
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