Olympic Steel Inc., a national metals service center, today announced financial results for the fourth quarter and full year ended Dec. 31, 2015.
Consolidated 2015 fourth-quarter net sales were $237.5 million, down from the $326.7 million fourth-quarter record net sales reported in 2014. Full-year net sales fell 18 percent to $1.2 billion from $1.4 billion in 2014, which was also an annual record. The company said sharply lower market prices and weaker demand, compared with last year, led to the net sales decrease in the fourth quarter and full year of 2015.
“Prior to the start of the year, we anticipated challenging industry conditions in 2015 and promptly executed an internal plan to cope with external developments,” said Chairman and Chief Executive Officer Michael D. Siegal. “During the year, proactive actions lowered operating expenses by more than $24 million, and prudent management of working capital helped generate more than $107 million in positive cash flow. Much of this cash was used to strengthen our balance sheet, as we reduced debt by more than $99 million during the year.”
For the fourth quarter of 2015, the Company reported a net loss of $5.0 million, or $0.45 per share. This compares with a net loss of $26.9 million, or $2.42 per share, in 2014’s fourth quarter, when results were negatively impacted by a $23.8 million goodwill impairment charge.
The reported net loss in 2015 was $26.8 million, or $2.39 per share, compared with a net loss of $19.1 million, or $1.71 per share, in 2014. In 2015, $25.0 million of goodwill and intangible assets were impaired, versus $23.8 million in 2014.
“Looking ahead, Olympic Steel enters 2016 with a particularly strong balance sheet, a significantly lower operating expense base aligned with the industry-wide decline in sales volumes, and faster-turning inventory. Although steel prices have firmed from the 2015 market lows of December, the industry environment remains uncertain. Our proven and continued discipline in cost containment and working capital management supported by a flexible, low-cost debt position is the right approach to weather persistently weak industry conditions. We believe that we are favorably positioned to take advantage of the market,” concluded Siegal.