Olympic Steel Earnings: Everything You Must Know Now

Olympic Steel Inc. (NASDAQ:ZEUS) delivered a profit and beat Wall Street’s expectations, BUT came up short on beating the revenue expectation. The revenue miss is a negative sign to shareholders seeking high growth out of the company.

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Olympic Steel Inc. Earnings Cheat Sheet

Results: Adjusted Earnings Per Share decreased 38.6% to $0.35 in the quarter versus EPS of $0.57 in the year-earlier quarter.

Revenue: Decreased 11.5% to $338.1 million from the year-earlier quarter.

Actual vs. Wall St. Expectations: Olympic Steel Inc. reported adjusted EPS income of $0.35 per share. By that measure, the company beat the mean analyst estimate of $0.28. It missed the average revenue estimate of $347.59 million.

Quoting Management: “Business activity sequentially rebounded in the first quarter compared with the end of last year,” stated Chairman and Chief Executive Officer Michael D. Siegal. “Steel prices also increased from the lows of late last year; however, they are below year-ago levels and are expected to remain soft.
“Tubular and Pipe Products continued to perform well during the quarter, as did our new start-up ventures, which made increasingly positive contributions to consolidated profits as they continued to mature. Having essentially completed the capital outlays associated with our multi-year growth plan, we are now focused on generating higher cash flow and earnings. We further expanded the Company’s market share in stainless steel—one of our strategic growth areas—and capital expenditures in the first quarter declined by more than 75% compared with last year.”

Key Stats (on next page)…

Revenue increased 15.9% from $291.72 million in the previous quarter. EPS increased to $0.35 in the quarter versus EPS of $-0.32 in the previous quarter.

Looking Forward: Analysts have a more negative outlook for the company’s next-quarter performance. Over the past three months, the average estimate for next quarter’s earnings has fallen from a profit of $0.57 to a profit $0.39. For the current year, the average estimate has moved down from a profit of $1.72 to a profit of $1.37 over the last ninety days.

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(Company fundamentals provided by Xignite Financials. Email any earnings discrepancies to earnings [at] wallstcheatsheet.com)