US-based Insteel expects a strong performance in the second half of the year due to favorable trends in non-residential construction markets and a seasonal upturn.
Private construction indicators are signaling a return in investment activity to pre-pandemic levels, the company said in its Q2 2021 (ended March 31, 2021) earnings report on Friday. Public construction activity through the past six months has remained sturdy.
Insteel received favorable determinations in anti-dumping and countervailing duty trade cases, which will likely result in margin safeguards on wire reinforcing products such as PC strand and standard welded wire reinforcement. Full decisions by the US Commerce Department are expected in Q3 2021 (ended June 2021). Limited imports should give Insteel an opportunity to capture more market share.
Insteel’s net sales increased by 21pc to $139mn in Q2 2021 against the same year-ago quarter as net earnings increased to $14.9mn in the same period. The average selling price for steel increased by 12.7pc as shipments rose by 3.1pc. As a result, gains were mostly due to stronger per item prices in the market.
The gross margin for the company increased to 21.7pc in the second quarter compared to the same period a year ago. Capital expenditures for 2021 will total $20mn, Insteel indicated.