Commercial Metals Company Reports First Quarter Fiscal 2020 Results
by David Fleschen
Commercial Metals Company (NYSE: CMC) today announced financial results for its fiscal first quarter ended November 30, 2019. First quarter earnings from continuing operations were $82.8 million, or $0.69 per diluted share, on net sales of $1.4 billion, compared to prior year period earnings from continuing operations of $19.4 million, or $0.16 per diluted share, on net sales of $1.3 billion. Net sales increased 8% on a year-over-year basis driven by the Company's growth strategy and strong fundamentals in its core markets.
As a result of ongoing network optimization efforts, a decision was made to cease melting operations at our Rancho Cucamonga, CA facility, which resulted in a net after tax charge of $5.0 million. Excluding these expenses, adjusted earnings from continuing operations were $87.8 million, or $0.73 per diluted share, as detailed in the non-GAAP reconciliation on page 12. This represents a 109% increase compared to adjusted earnings from continuing operations of $0.35 per diluted share for the three months ended November 30, 2018.
Barbara R. Smith, Chairman of the Board, President and Chief Executive Officer, commented, "The first quarter marked the best financial performance from our strategically repositioned portfolio of operations. This milestone reflects the continued health of the U.S. non-residential construction sector, which contributed to strong performances in our Americas Mills and Fabrication segments. We believe the metal margin performance seen over recent quarters highlights the stability of CMC's rebar and long product offerings compared to the broader steel market."
"Strong earnings and working capital management during the quarter allowed us to further de-lever our balance sheet. Over the past 12 months, we have made debt repayments of $173.8 million."
The Company's liquidity position as of November 30, 2019 remained strong, with cash and cash equivalents of $224.8 million and availability under the Company's credit and accounts receivable facilities of $659.9 million.
On January 2, 2020, the board of directors of CMC declared a quarterly dividend of $0.12 per share of CMC common stock payable to stockholders of record on January 15, 2020. The dividend will be paid on January 30, 2020, and marks 221 consecutive quarterly dividend payments.
Source: CMC, Photo: Fotolioa