Steel Mills
CMC earnings fall on seasonal weakness, economy woes
Written by Ethan Bernard
March 20, 2025
CMC
| Fiscal second quarter ended Feb. 28 | 2025 | 2024 | % Change |
|---|---|---|---|
| Net sales | $ 1,754 | $1,848 | -5.1% |
| Net earnings (loss) | $25.5 | $85.8 | -70.3% |
| Per diluted share | $0.22 | $0.73 | -69.9% |
| Six months ended Feb. 28 | |||
| Net sales | $ 3,664 | $3,851 | -4.9% |
| Net earnings (loss) | ($150.2) | $262.1 | -157.3% |
| Per diluted share | ($1.32) | $2.22 | -159.5% |
CMC’s earnings tumbled in its fiscal second quarter on seasonal weakness and continued shakiness in the wider economy.
The Irving, Texas-based steelmaker posted net income of $25.5 million in its Q2’25 ended Feb. 28, off 70% from $85.8 million a year earlier. Net sales fell 5% to $1.75 billion in the same comparison.
The earnings were impacted by a net after-tax charge of $3.9 million related to previously disclosed litigation with Pacific Steel Group in California.
“In our seasonally weaker second quarter, during a period of continued economic uncertainty, the CMC team bolstered profitability across each segment by targeted actions to increase commercial discipline and optimize costs, in order to support higher margins,” Peter Matt, president and CEO, said in a statement on Thursday.
Matt cited improved scrap market conditions, rising long steel prices, a rebound in downstream project awards, and better price levels for new downstream work as bright spots in its North American steel business in the quarter.
“Taken together, we believe these developments signal a near-term inflection in profitability levels heading into the spring and summer construction season,” he added.
The company said solid North American construction demand in the quarter helped lead to a 3.3% rise in finished steel shipments vs. the previous year fiscal second quarter.
Outlook
Matt said CMC expects financial results in its third quarter to “rebound” from second quarter levels.
“Finished steel shipments within the North America Steel Group are anticipated to follow normal seasonal trends as we enter the spring and summer construction seasons, while our adjusted EBITDA margin is expected to increase sequentially on higher margins over scrap on steel products,” he added.
Matt was also upbeat as far as outlook for upcoming quarters.
“We are encouraged by recent developments across the various markets in which we participate. Margin and demand trends appear to be improving, which should position us well for the upcoming spring and summer construction season,” he said.
Ethan Bernard
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