Steel Mills

Worthington Sales Up--Profit Falls from Rebranding Charges

December 19, 2013

Worthington Industries, Inc. reported net earnings of $23.0 million and net sales of $769.9 million for the second quarter of fiscal year 2014, ending November 30, 2013. Net sales increased 24 percent from the previous year and 9 percent from the previous quarter and were attributed to higher overall volumes related to new acquisitions.

Net earnings were impacted by a $30.7 million charge related to the write-off of certain trade name assets in connection with re-branding the Company’s businesses under the Worthington Industries name, as well as a gain of $2.5 million from insurance proceeds received for property damage at the company’s pressure cylinder facility in Austria.

Steel processing sales of $492.1 million were up 43 percent year-over-year from consolidation of TWB and increased sales in the auto, construction and agricultural markets.

The trade name impairment negatively impacted operating income for both Pressure Cylinders and Engineered Cabs. Recent acquisitions drove pressure cylinders sales up 3 percent from the preceding year for net sales of $214 million. Engineered Cab net sales were down 17 percent year-over-year to $47.9 million.

Worthington did not provide an earnings forecast for third quarter.

“We had a very good second quarter with strong results from Steel Processing and solid results from Pressure Cylinders and our joint ventures,” said John McConnell, Chairman and CEO. “We are now positioning our businesses under one single brand, Worthington Industries. The Company is growing organically and through acquisitions, providing us with new platforms and new markets. As a result, we want to make sure our brand is front and center for our customers and shareholders.”