Friedman Industries expects margins to improve in Q4 2020 after an improvement in its supply chain after steel prices increased in January 2020. For fiscal 2021, the company was unable to provide a clear forecast on steel pricing and margins since prices have flattened again in February.
The Texas-based steel coils and tubular manufacturer reported a decline in its coil sales—due to a sustained decline in hot-rolled coil prices—in Q3 2020, ended December 31, 2019. The company’s coil sales decreased to around $21mn in Q3, compared with $28mn in the same quarter in 2018, despite the sales volume increasing during the same period to 34,500t (31297.8mt) from31,500t in the prior year period.
The sales of its tubular products almost halved from $14.5mn in Q3 2019 to $7.1mn in Q3 2020, the company reported citing low volumes as well as low steel prices for the decline. The sales volume for Friedman’s tubular products decreased from 20,000t in Q3 2019 to 11,000t in Q3 2020.
The company, which has facilities in Hickman, Arkansas, Decatur, Alabama, and Lone Star, Texas, reported a net loss of around $881,000 during the quarter.