Schnitzer Steel Industries, Inc. will report on Monday, January 9, 2012, the financial results for its fiscal 2012 first quarter, which ended on November 30, 2011, and will webcast a conference call to discuss the performance at 11:30 a.m. Eastern on the same day. In advance of its full earnings release, Schnitzer is providing preliminary results for its first quarter of fiscal 2012 to reflect the impact of significant market volatility during the quarter.
Schnitzer expects first quarter results to be lower than the outlook provided in its fourth quarter fiscal 2011 earnings release due to weaker than anticipated global market conditions for recycled metals. Heightened global recessionary concerns, stemming primarily from the European debt crisis which escalated during the quarter, resulted in a significant slowdown in buying patterns and a sharp decline in sales prices. During the quarter, operating margins contracted more than anticipated. The most significant factor affecting operating margins was the negative impact of average inventory costs which did not keep pace with the rapid decline in average net selling prices. Schnitzer’s fully diluted earnings per share are expected to be in the range of $0.18 – $0.25 for the first quarter of fiscal 2012.
With respect to our Metals Recycling Business, operating income per ferrous ton is expected to be approximately 50% lower than the $21 per ton recorded in the first quarter of fiscal 2011. In our Auto Parts Business, operating income is expected to be approximately 30% lower than recorded in the first quarter of fiscal 2011. Sales prices began to strengthen towards the end of the quarter, but the improvements are not expected to benefit results until later in the second quarter.
The webcast of the call and the accompanying slide presentation may be accessed on the Schnitzer Steel website under the Investors section’s Event Calendar at www.schnitzersteel.com/events. The call will be hosted by Tamara Lundgren, President and Chief Executive Officer, and Richard Peach, Senior Vice President and Chief Financial Officer.