CMC’s summer earnings down from 2022

CMC has reported a 36 percent decline in profits in the financial quarter ending Aug. 31. The Irving, Texas-based metals recycling, steelmaking and construction products company reports net sales of $2.2 billion in its most recently completed quarter, down from $2.4 billion one year ago.

The June 1-Aug. 31 time frame was the fourth quarter of CMC’s 2023 fiscal year. For the full fiscal year running from Sept. 1, 2022, to Aug. 31, CMC earned $859.8 million, or $7.25 per diluted share, on net sales of $8.8 billion. That compares with prior year net earnings of more than $1.2 billion, or $9.95 per diluted share, achieved with net sales of $8.9 billion.

Results from its most recently completed quarter reflected charge of $15.7 million CMC says is primarily related to commissioning efforts at the Arizona 2 micromill.

“Fiscal 2023 marked another exceptional year for CMC, with highlights including record employee safety performance, the second-best financial results in our company’s 108-year history, and the achievement of several strategic growth milestones,” says Peter Matt, president and CEO at CMC.

“On behalf of our board of directors, employees, and shareholders, I also want to thank Barbara Smith for her outstanding leadership as CEO, which has transformed the company and built a strong foundation for the future.”

Matt says the Arizona 2 micromill successfully started operations in June and adds, “Construction has commenced at our Steel West Virginia project, with key operations and leadership teams now on site.” The West Virginia scrap-fed electric arc furnace mill is expected to begin producing steel rebar in late 2025.

CMC saw its North American average selling price for steel products decrease $172 per ton compared with the fourth quarter of fiscal year 2022, while the cost of the scrap it used declined $49 per ton, resulting in a year-over-year decrease in steel products margin over scrap of $123 per ton.

“We expect first quarter [this autumn] consolidated financial performance to remain strong by historical standards, but decline from the fourth quarter as a result of seasonally lower shipments, steel product margin compression in North America, and the continuation of challenging market conditions in Europe," Matt says.

In Europe, CMC operates a steel mill and scrap yards in Poland and downstream building products operations and sales offices in Poland, Germany and the United Kingdom.