TORONTO, Aug. 2, 2017 /PRNewswire/ - Russel Metals Inc. (RUS - TSX) announces financial results for second quarter ended June 30, 2017.

For the 2017 second quarter, we report net income of $33 million or $0.52 per share on revenues of $817 million compared to net income of $16 million or $0.27 per share in the second quarter of 2016.  Increased volumes in our energy products and steel distributor segments coupled with higher steel prices led to increased gross margins and improved operating profits from the 2016 second quarter.

Revenues in our metals service centers increased 14% to $416 million for the quarter compared to the same period in 2016.  Tons shipped in the second quarter of 2017 approximated tons shipped in the second quarter of 2016.  The average selling price improved 15% over second quarter 2016 reflecting mill price increases and continued growth in value-added processing.  Gross margins were 21.6% compared to 22.9% in the second quarter of 2016 as a result of stable steel prices in 2017 compared to rising steel prices in the 2016 second quarter.  Operating profits were consistent with the same quarter in 2016.

Revenues in our energy products segment increased 68% to $296 million compared to $176 million in the 2016 second quarter.  Revenue increases were due to higher rig counts, stronger prices due to the reduction of the industry inventory overhang and a shorter Canadian spring break up.  Gross margins were 18.7% compared to 16.4% for the 2016 second quarter.  This segment had operating profits of $22 million compared to $1 million in the same quarter last year as all of our operations in this segment posted stronger results. 

Revenues in our steel distributors segment increased by 25% to $101 million compared to $81 million in the 2016 second quarter due to higher volumes and steel prices.  Gross margins were 19.0% compared to 18.5%.  Operating profits were $10 million compared to $9 million in the 2016 second quarter.

Our revenues for the six months ended June 30, 2017 were $1.6 billion up 26% from $1.3 billion for the same period in 2016.  Our 2017 year to date earnings of $62 million or $1.00 per share compared to $24 million or $0.39 per share for the same period in 2016.

Mr. John G. Reid, President and COO, commented, "We are pleased with our year to date performance with all of our operations reporting improved results.  Our energy products operations rebounded considerably resulting in our strongest year over year segment improvement.  We expect demand in the energy products segment to improve in the seasonally stronger third quarter."

Mr. Reid continued, "As the economic recovery continues, our emphasis on improving operating efficiencies coupled with our disciplined approach to working capital has had a positive impact on earnings. The pending U.S. trade actions, however, have created tension in the marketplace and may, once announced, impact the current pricing environment."

The Board of Directors approved a quarterly dividend of $0.38 per common share payable September 15, 2017 to shareholders of record as of August 28, 2017.

The Company will be holding an Investor Conference Call on Thursday, August 3, 2017 at 9:00 a.m. ET to review its 2017 second quarter results.  The dial-in telephone numbers for the call are 416-764-8688 (Toronto and International callers) and 1-888-390-0546 (U.S. and Canada).  Please dial in 10 minutes prior to the call to ensure that you get a line.

A replay of the call will be available at 416-764-8677 (Toronto and International callers) and 1-888-390-0541 (U.S. and Canada) until midnight, Thursday, August 17, 2017.  You will be required to enter pass code 156805 in order to access the call.

Additional supplemental financial information is available in our investor conference call package located on our website at www.russelmetals.com.

Russel Metals is one of the largest metals distribution companies in North America.  It carries on business in three metals distribution segments: metals service centers, energy products and steel distributors, under various names including Russel Metals, A.J. Forsyth, Acier Leroux, Acier Loubier, Alberta Industrial Metals, Apex Distribution, Apex Monarch, Apex Remington, Apex Western Fiberglass, Arrow Steel Processors, B&T Steel, Baldwin International, Comco Pipe and Supply, Fedmet Tubulars, JMS Russel Metals, Leroux Steel, McCabe Steel, Mégantic Métal, Métaux Russel, Métaux Russel Produits Spécialisés, Milspec, Norton Metals, Pioneer Pipe, Russel Metals Processing, Russel Metals Specialty Products, Russel Metals Williams Bahcall, Spartan Energy Tubulars, Sunbelt Group, Triumph Tubular & Supply, Wirth Steel and York-Ennis.

Cautionary Statement on Forward-Looking Information

Certain statements contained in this press release constitute forward-looking statements or information within the meaning of applicable securities laws, including statements as to our future capital expenditures, our outlook, the availability of future financing and our ability to pay dividends.  Forward-looking statements relate to future events or our future performance.  All statements, other than statements of historical fact, are forward-looking statements.  Forward-looking statements are often, but not always, identified by the use of words such as "seek", "anticipate", "plan", "continue", "estimate", "expect", "may", "will", "project", "predict", "potential", "targeting", "intend", "could", "might", "should", "believe" and similar expressions.  Forward-looking statements are necessarily based on estimates and assumptions that, while considered reasonable by us, inherently involve known and unknown risks, uncertainties and other factors that may cause actual results or events to differ materially from those anticipated in such forward-looking statements, including the factors described below.

We are subject to a number of risks and uncertainties which could have a material adverse effect on our future profitability and financial position, including the risks and uncertainties listed below, which are important factors in our business and the metals distribution industry.  Such risks and uncertainties include, but are not limited to: the volatility in metal prices; volatility in oil and natural gas prices; cyclicality of the metals industry and the industries that purchase our products; decreased capital and other expenditures in the energy industry; product claims from customers; significant competition that could reduce our market share; the interruption in sources of metals supply; manufacturers selling directly to our customer base; material substitution; credit risk of our customers; lack of credit availability; change in our credit ratings; currency exchange risk; restrictive debt covenants; non-cash asset impairments; the unexpected loss of key individuals; decentralized operating structure; the availability of future acquisitions and their integration; the failure of our key computer-based systems, including our enterprise resource and planning systems, failure to renegotiate any of our collective agreements and work stoppages; litigious business environment; environmental liabilities; environmental concerns or changes in government regulations; legislation on carbon emissions; workplace health and safety laws and regulations; significant changes in laws and governmental regulations; fluctuation of our common share price; dilution; and variability of dividends.

While we believe that the expectations reflected in our forward-looking statements are reasonable, no assurance can be given that these expectations will prove to be correct, and our forward-looking statements included in this press release should not be unduly relied upon.  These statements speak only as of the date of this press release and, except as required by law, we do not assume any obligation to update our forward-looking statements.  Our actual results could differ materially from those anticipated in our forward-looking statements including as a result of the risk factors described above and under the heading "Risk" in our MD&A and under the heading "Risk Management and Risks Affecting Our Business" in our most recent Annual Information Form and as otherwise disclosed in our filings with securities regulatory authorities which are available on SEDAR at www.sedar.com.

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SOURCE Russel Metals Inc.