Commercial Metals Company (CMC) foresees strong demand throughout the end markets, which will boost its finished steel shipment volumes during Q4 in North America and Europe.
The steel producer achieved record earnings for Q3 FY2021 ended May 31, 2021, and said the construction sector is solid, while industrial areas are rising in US and Central European markets on continuing revival from the COVID-19 pandemic.
The company projects its fourth-quarter margins will be above scrap prices, on steel sales in North America and Europe, but will remain flat or increase slightly over Q3 levels. Demand has also picked up with downstream consumers in North America as evidenced by new contracts, construction order books, and improving lead times.
Considerable progress was made on major projects, CMC noted, including hot commissioning of its third rolling mill in Poland, and receiving the necessary air permit for its Arizona 2 mill, along with other continued network optimization initiatives. Impacts from these plans are anticipated to continue boosting future company results.
In North America, the recycler shipped 9.4pc more steel products at 2.28mn nt (2.07mn mt) in H1 FY2021, compared to 2.08mn nt of steel products shipped in September-May 2020. The segment shipped 789,000nt of steel products in March-May 2021, up 17.1pc against 674,000nt of steel shipments in Q3 FY2020.
In Europe, the company shipped 1.15mn nt of steel products in H1 FY2021, up 5.7pc against 1.09mn nt of steel product shipments in the prior-year period. The segment’s steel products shipments rose by 8pc to 404,000nt in Q3 FY2021 compared to 374,000nt in March-May 2020.
CMC’s total net sales tallied at $4.7bn in H1 FY2021, up 15.5pc compared to $4.07bn in net sales during September-May 2020. The company’s consolidated net sales surged by 37.5pc to $1.85bn in March-May 2021 compared to $1.34bn in the same prior-year period.
The steel manufacturer recorded a 23.8pc rise in earnings from continuing operations at $261mn during September-May 2021 against $211mn in September-May 2020. Earnings from continuing operations soared 103pc to $130mn in March-May 2021 compared to $65mn in the prior-year period.