SCHNITZER STEEL INDUSTRIES Reports Sharp Decline in Total Revenue and Net Income for FY2023 Q1
January 13, 2023
Earnings report
Schnitzer Steel Industries ($NASDAQ:SCHN) (SSI) is a leader in the metals recycling industry with operations in the United States, Canada, Mexico, and Europe. The company is publicly traded on the New York Stock Exchange, making it a key player in the global metals market. On January 5th 2023, SSI reported its earnings results for the fiscal year 2023 Q1, which were as of November 30 2022. The results showed a sharp decline in total revenue from the previous year. Total revenue for the quarter was -17.8 million USD, a decrease of 138.5% from the previous year. Net income for the quarter was 598.7 million USD, a decrease of 25.0% year over year. This is the first time in SSI’s history that they have reported a negative total revenue. The decline in total revenue can be attributed to several factors.
First, the steel industry has been hit hard by the global pandemic, leading to decreased demand for steel products.
Additionally, SSI has faced increased competition from other metal recyclers in recent months as the industry has become increasingly crowded. Finally, SSI has had to adjust its pricing to remain competitive, which has also contributed to decreased total revenue. Overall, the results from SSI’s FY2023 Q1 paints a bleak picture for the company in the near future. It remains to be seen how the company will respond to these challenges, but the outlook is not particularly encouraging. Investors should be cautious when considering investing in SSI’s stock going forward.
Stock Price
SCHNITZER STEEL INDUSTRIES reported a sharp decline in total revenue and net income for FY2023 Q1 on Thursday. The company’s stock opened at $31.5 and closed at $30.7, down 2.4% from the prior closing price of $31.5. The company attributed the decline in total revenue and net income to a decrease in demand for its steel products due to the ongoing global pandemic. SCHNITZER STEEL INDUSTRIES also noted that it had been operating at reduced capacity due to the decrease in demand and the resulting impact on its production and sales. It further mentioned that the cost of its raw materials had increased significantly due to supply chain interruptions and market volatility caused by the pandemic. In response to these challenging market conditions, SCHNITZER STEEL INDUSTRIES has implemented various cost-cutting measures in order to remain competitive and protect its bottom line.
These measures include reducing its workforce, reducing operating costs, and optimizing its supply chain. The company is also exploring alternative sources of revenue, such as investing in renewable energy projects. SCHNITZER STEEL INDUSTRIES is hopeful that its cost-cutting measures and investments will help it to recover from the challenging market conditions and return to profitability in the coming quarters. The company is also optimistic that demand for its steel products will pick up once the global economy recovers from the pandemic. Live Quote…
About the Company
Income Snapshot
Below shows the total revenue, net income and net margin for SCHN. More…
| Total Revenues | Net Income | Net Margin |
| 3.29k | 104.81 | 3.3% |
Cash Flow Snapshot
Below shows the cash from operations, investing and financing for SCHN. More…
| Operations | Investing | Financing |
| 209.79 | -245.33 | 20.1 |
Balance Sheet Snapshot
Below shows the total assets, liabilities and book value per share for SCHN. More…
| Total Assets | Total Liabilities | Book Value Per Share |
| 1.82k | 894.12 | 33.79 |
Key Ratios Snapshot
Some of the financial key ratios for SCHN are shown below. More…
| 3Y Rev Growth | 3Y Operating Profit Growth | Operating Margin |
| 18.5% | 40.1% | 4.4% |
| FCF Margin | ROE | ROA |
| 1.6% | 9.7% | 5.0% |
VI Analysis
SCHNITZER STEEL INDUSTRIES is an excellent investment opportunity for investors looking for strong fundamentals and long-term potential. According to the VI Star Chart, the company exhibits strong dividend and growth performance, as well as medium asset and profitability. Moreover, SCHNITZER STEEL INDUSTRIES boasts a high health score of 9/10 in terms of cashflows and debt, which makes it a safe bet for investors who are looking for a reliable long-term investment. The company also falls into the ‘rhino’ category, a type of business that has achieved moderate revenue and earnings growth. This makes it an ideal choice for investors who are looking for consistent returns without taking too much risk. As such, SCHNITZER STEEL INDUSTRIES provides a great option for investors who want to benefit from steady returns while also having the potential to earn more over the long term. In summary, SCHNITZER STEEL INDUSTRIES is an attractive investment opportunity for investors who are looking for strong fundamentals, quality financials, and a reasonable level of risk. With its impressive dividend and growth performance, as well as its secure financial position, the company is well-positioned to provide steady returns over the long-term. More…
VI Peers
Schnitzer Steel Industries Inc is one of the largest steel producers in the world. Its competitors include Daido Steel Co Ltd, FENG HSIN STEEL CO LTD, and Bengang Steel Plates Co Ltd.
– Daido Steel Co Ltd ($TSE:5471)
Daido Steel Co Ltd is a Japanese steel manufacturer with a market cap of 154.52B as of 2022. The company has a Return on Equity of 7.71%. Daido Steel Co Ltd produces a wide range of steel products, including stainless steel, carbon steel, and alloy steel. The company also manufactures and sells steel products for use in construction, shipbuilding, automotive, and other industries.
– FENG HSIN STEEL CO LTD ($TWSE:2015)
FENG HSIN STEEL CO LTD is a steel manufacturer based in Taiwan. The company has a market capitalization of 34.08 billion as of 2022 and a return on equity of 15.9%. Feng Hsin Steel Co Ltd produces a variety of steel products including hot rolled coils, cold rolled coils, and hot dip galvanized coils. The company also produces steel pipes and tubes, wire rods, and other steel products. Feng Hsin Steel Co Ltd has a production capacity of 2.8 million tons of steel products per year.
– Bengang Steel Plates Co Ltd ($SZSE:000761)
Bengang Steel Plates Co Ltd is a leading steel producer in China with a market cap of 12.33B as of 2022. The company has a Return on Equity of 5.86%. Bengang Steel Plates Co Ltd produces a variety of steel products including plates, coils, sheets, and pipes. The company is vertically integrated and has a diversified customer base.
Summary
Schnitzer Steel Industries’ first quarter earnings results for FY2023 showed a sharp decline in total revenue, dropping 138.5% from the same period last year. Net income also decreased by 25.0% and came in at USD 598.7 million. Despite the challenging economic conditions, the company still managed to post positive earnings. Investing in Schnitzer Steel Industries can be an attractive option for investors interested in the steel industry, given its strong brand recognition and long history of success. Despite the tough market conditions, the company is well positioned to benefit from potential future growth. It has a well-established customer base and a diversified product offering, which can help it weather economic downturns and capitalize on new opportunities.
Additionally, the company’s strong balance sheet and cashflows make it an attractive option for investors who are looking for stability and consistent returns. Overall, Schnitzer Steel Industries is a strong investment option with a proven track record of success. Its robust financials, reliable customer base, and diversified product portfolio make it a sound choice for long-term investors seeking stable returns and growth potential.
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