Service Centers

Russel Metals earnings slip in Q3 in volatile steel mart
Written by Stephanie Ritenbaugh
November 7, 2024
Russel Metals
Third quarter ended Sept. 30 | 2024 | 2023 | % Change |
---|---|---|---|
Net sales | $1,089 | $1,110 | -1.9% |
Net earnings (loss) | $35 | $61 | -42.6% |
Per diluted share | $0.59 | $0.99 | -40.4% |
Nine months ended Sept. 30 | |||
Net sales | $3,222 | $3,486 | -7.5% |
Net earnings (loss) | $134 | $220 | -39.0% |
Per diluted share | $2.26 | $3.55 | -36.3% |
Russel Metals Inc.’s profit shrank during the third quarter as steel prices continued to be volatile.
Net earnings for the third quarter of 2024 were Canadian $35 million (US$37.8 million), down from CAD$61 million during the same period last year.
“Our third-quarter 2024 results demonstrated the benefits to our growing and diversified business,” the Toronto-based metals distributor stated. “In particular, the steel price environment that negatively impacted revenues and margins in our metal service centers segment was somewhat offset by higher revenues and steady margins in our energy field stores segment.”
The company said the average price of plate fell by 12% quarter over quarter. Hot-rolled coil prices were volatile over the past two quarters but averaged a similar price in the third quarter vs. the previous quarter.
On a same store basis, volumes at service centers dropped by 5% quarter over quarter but were 1% higher compared to the third quarter of 2023. The company said the volumes were consistent with seasonal trends.
In August, Russel closed its acquisition of seven service center locations from Samuel, Son & Co., Limited. The deal included five locations in Western Canada and two in the northeastern United States. Initially the deal was valued at CAD$225 million, but the structure included a dollar-for-dollar adjustment to the purchase price for changes in working capital in the period prior to closing. The invested capital was cut to CAD$167 million on Sept. 30.
Outlook
Russel expects steel prices to remain volatile into the early part of the fourth quarter.
“We expect that producers will proactively manage supply through both regular maintenance downtime and other curtailments in the fourth quarter in order to rebalance supply,” the company said in a statement. “As such, we expect steel prices to demonstrate ongoing uncertainty in the fourth quarter of 2024 but set the stage for a more favorable dynamic in 2025.”
Russel expects growth to come from onshoring activities and infrastructure spending initiatives in both Canada and the US.

Stephanie Ritenbaugh
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