Schnitzer Steel recorded positive results in Q1 2021, ended November 30, 2020, that reflected its second-highest Q1 operating income in 10 years.
The markets strengthened during Q1 2021 as domestic ferrous scrap prices returned to pre-COVID levels and non-ferrous and export ferrous sales attained record highs by the end of the financial quarter.
The recycler credited its tactical investments in advanced technology of metal recoveries for the improvement of its operational efficiencies. It expects the implementation of these initiatives to be completed by the end of the financial year, the company said in a news release.
The manufacturer sees several trends that support continued strength in ferrous and nonferrous scrap demand, noting that the recent large price increases were driven by low inventories that followed several months of de-stocking. Drastically higher buying plans along with output volumes at steel mills, transitioning to lowered carbon methods, and China’s probable reentry as a global ferrous scrap importer are also contributing towards upholding scrap demand.
The exporter recorded ferrous sales volumes of 1.05mn gt (1.07mn mt) in Q1 2021, up by 7.89pc from 976,000gt during Q1 2020. The company’s finished steel sales volumes rose by 17.5pc to 134,000nt (121,563mt) from 114,000nt during the same previous fiscal quarter.
Schnitzer noted its rolling mill utilization rate was at 97pc in Q1 2021, improved from 85pc in Q1 2020.
The company’s nonferrous sales volumes fell by 4.3pc to 62,596mt in Q1 2021 from 65,317mt in the same quarter last fiscal.
The recycler posted revenue of $492.1mn in Q1 2021, up 21pc from $405.6mn in Q1 2020, while its net income tallied at $15.1mn, up considerably from a net loss of $6.6mn during the same period under comparison. Adjusted EBITDA totaled $40mn in Q1 2021 compared to $10mn in Q1 2020.