Commercial Metal Company (NYSE:CMC) reported first-quarter net sales of $1.91 billion, beating the consensus of $1.873 billion.
Core EBITDA fell to $210.7 million from $313.7 million in the year-ago quarter, with a core EBITDA margin of 11.0%, compared to 15.7%. Adjusted earnings per share were $0.78, missing the $0.81 consensus.
The company reported strong North American demand, fueled by late-season construction work as projects recovered from previous weather delays.
Finished steel deliveries increased 4.4% year-on-year, with a healthy project pipeline indicated by steady downstream backlog and bidding activity.
Product shipments from vendors also grew, supported by improved service to West Coast customers from the Arizona 2 microfactory.
Adjusted EBITDA for CMC’s North America Steel Group fell to $188.2 million in the first quarter of FY25, compared to $266.8 million a year earlier, due to lower margins on steel and downstream products.
Adjusted EBITDA margin for North America Steel Group decreased to 12.4%, compared to 16.8% in the same period last year.
The company said European market conditions in the quarter were similar to recent periods, with long steel consumption significantly below historical levels.
Europe Steel Group reported adjusted EBITDA of $25.8 million, including an annual carbon credit of $44.1 million from a government program through 2030.
At the end of November, cash and cash equivalents totaled $856.1 million, with available liquidity of nearly $1.7 billion. Net cash from operating activities totaled $213.0 million, compared to $261.06 million a year ago.
During the quarter, CMC repurchased 919,481 shares of common stock valued at $50.4 million; $353.4 million remained available under the current share repurchase authorization.
On January 2, 2025, the board declared a quarterly dividend of $0.18 per share, payable on January 30, to shareholders of record on January 16, 2025.
Peter Matt, President and Chief Executive Officer, said: “Financial results continued to be hampered by economic uncertainty that weighed on new construction activity and put pressure on steel prices and margins. We remain confident that this weaker demand environment will be temporary as we expect underlying drivers in the infrastructure, non-residential and residential end markets to support our business for years to come.”
“Our downstream bid levels and several key external indicators continue to point to a robust pipeline of potential future projects that should translate into construction activity in the coming quarters.”
