Schnitzer Steel Industries, known as Radius Recycling, revealed a challenging first quarter of fiscal 2024. Facing a $(18) million net loss and $(0.64) loss per share from continuing operations, the company encountered reduced supply flows for recycled metals, causing a squeeze in metal spreads due to lower net selling prices and subdued manufacturing activity in the U.S. and Asia.
Schnitzer Steel Industries, also known as Radius Recycling in the market, released its fiscal 2024 first-quarter results. This period marked a turbulent start for the company, witnessing a net loss of $(18) million and a $(0.64) loss per share from continuing operations. These figures depict a challenging landscape due to tighter supply flows for recycled metals.
The compressed metal spreads resulted from a conjunction of reduced average net selling prices for the company's products and constrained manufacturing activities both in the United States and across Asia. The economic slowdown in China played a pivotal role, significantly impacting Asian markets and causing elevated levels of Chinese steel exports.
Despite the challenging scenario, there were positive strides in certain segments. Nonferrous sales volumes saw a commendable 12% surge year-over-year, attributed to the Company’s advanced nonferrous recovery technologies and an acquisition in the previous fiscal year. Additionally, the company witnessed a 10% increase in finished steel sales volumes, owing to robust non-residential demand in western U.S markets. However, the overall mill utilization rate dropped to 95%.
Ms. Tamara Lundgren, the Chairman and Chief Executive Officer, acknowledged the tough market conditions but emphasized the company's resilience in navigating volatility. Lundgren highlighted strategic investments that led to higher nonferrous volumes and a $30 million productivity improvement program initiated in the prior year. She expressed optimism about leveraging near-term market improvements and the anticipated surge in demand for recycled metals aligned with decarbonization and low-carbon technologies.
Furthermore, the company recently issued its tenth annual Sustainability Report, underscoring its commitment to advancing the circular economy. The report highlighted achievements in reducing greenhouse gas emissions, reaching goals ahead of schedule, and maintaining a 100% net carbon-free electricity usage at operations for three consecutive years.
Radius Recycling faced challenges in its first fiscal quarter of 2024, reporting an $(18) million net loss and $(0.64) loss per share due to decreased supply flows and lower metal prices. Despite this, there were positive strides in nonferrous sales and finished steel volumes. CEO Tamara Lundgren highlighted strategic investments and sustainability achievements, aiming to navigate market challenges and leverage opportunities in the future.