Steel Product Producers
Friedman Expects Hedging Gains To Offset HRC Pricing Pressure
Written by Laura Miller
August 15, 2023
Longview, Texas-based steel processor Friedman Industries is anticipating steady demand in the current quarter.
Downward pricing pressure on hot-rolled coil (HRC) will lead to lower margins, but this should be offset by hedging related gains, the company said in its earnings report for its fiscal 2024 first quarter ended June 30.
Q1 sales in Friedman’s flat-roll product segment declined 13% from the year-ago quarter due to lower selling prices. Tons sold were up 28% year over year to 120,000 tons, primarily due to the acquisition of Plateplus Inc. in April 2022, as well as a new facility in Sinton, Texas, coming online in October 2022, the company said.
In its tubular products segment, lower prices and fewer tons sold resulted in a 36% year-over-year decline in sales to $12.1 million. Sales volumes were down 14% to 9,000 tons.
All told, Friedman’s fiscal Q1 net earnings were $7.7 million on sales of $137.3 million, down 31% and 15%, respectively, from the same quarter last year.
Friedman Industries Inc.
| First quarter ended June 30 | 2023 | 2022 | % Change |
|---|---|---|---|
| Net sales | $137.3 | $161.8 | -15% |
| Net earnings (loss) | $7.7 | $11.2 | -31% |
| Per diluted share | $1.04 | $1.55 | -33% |
“Our first-quarter results are a great start to fiscal year 2024 as we strive to deliver record earnings for a third year in a row,” commented president and CEO Michael J. Taylor.
“Our team did a good job of evaluating and responding to market conditions during the first quarter. As fiscal 2024 continues, we are focused on maximizing sales volume on our existing assets while also evaluating additional growth opportunities for the company,” he added.
Friedman processes HRC at its facilities in Hickman, Ark.; Decatur, Ala.; East Chicago, Ind..; Granite City, Ill.; and Sinton, Texas. Its facility in Lone Star, Texas, manufactures electric-resistance welded pipe.
Laura Miller
Read more from Laura MillerLatest in Steel Product Producers
Nucor sees sequentially lower Q3 profits across all three business segments
Nucor's third-quarter earnings will be down quarter-over-quarter, but still higher than a year earlier.
Hyundai still on for Louisiana steel mill despite US raid at Georgia battery plant
Hyundai has reaffirmed its commitment to build a steel plant in Louisiana following a US government immigration raid at its battery facility in Georgia.
Hybar lowers output forecast, owning up to EAF startup delay
Hybar LLC’s rebar mill in Osceola, Ark., is now melting scrap and will soon be fulfilling orders, according to CEO David Stickler, despite a six-to-eight-week delay caused by commissioning the world’s first Aura electrical system.
Steel Dynamics guides to more metal, more money in Q3
Steel Dynamics Inc. is bullish heading into the close of the third quarter, with all three of its operating segments tracking higher.
AHMSA opens doors to potential buyers as $1.3B asset auction nears
AHMSA is opening its doors to potential buyers to tour its steel plant and mining operations in northern Mexico in preparation for the next stage of its bankruptcy process: the auction of its assets.