Reliance Steel sales volumes dip, prices rise in 4Q

Los Angeles-based service center Reliance Steel and Aluminum expects first quarter sales volumes to rise by a much as 8pc in the first quarter amid flat pricing after a fourth quarter marked by lower year-over-year sales volumes and higher prices.

Carbon steel sales volumes fell by 1.8pc year over year to 1.1mn st in the fourth quarter, while sales rose by 23pc to $1.5bn with its average price per short ton climbing by 26pc.

Aluminum volumes fell by 4.4pc to 83,100st, while sales increased by 13pc to $531mn on an 18pc rise in average prices from the prior year period.

Volumes of stainless steel fell by 1.3pc to 74,600st, while sales increased by 11pc to $386mn on a 12pc increase in average prices.

Alloy volumes fell by 4pc to 51,400st, while sales increased by 14pc to $168mn as average prices rose by 19pc.

Reliance Steel said it received an average price of $1,965/st in the quarter, an increase of 20pc compared to the same period of 2017. Net sales grew by 18pc to $2.8bn.

For full-year 2018 sales volumes, sales and prices all increased from 2017. Carbon steel volumes rose by 0.5pc to 4.9mn st, while sales rose by 21pc to $6.3bn on an average price rise of 21pc. Aluminum volumes rose by 0.7pc to 365,300st, while sales increased by 15pc to $2.2bn and average price rose by 15pc. Volumes of stainless steel grew by 4.5pc to 327,100st, while sales increased by 18pc to $1.6bn and average prices gained 13pc. Alloy volumes rose 0.5pc to 219,500st, while sales increased 16pc to $681mn and average price per st rose 15pc.

Overall in 2018 Reliance Steel said it received an average of $1,885/st, an increase of 18pc compared to $1,599/st in 2017. Net sales grew by 19pc to a record $11.5bn.

Still, Reliance Steel's fourth quarter profit fell by 72pc to $85.6mn from the same period of 2017 because of a $106.8mn LIFO expense in the quarter, nearly double the $55mn the company had expected.

Full-year 2018 profit rose by 3.3pc to $633.7mn compared to 2017.

Looking forward, the company expects to pay higher prices on steady demand and recent steel price increase announcements, but that most of those impacts will be felt after the first quarter.