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Nov 30, 2024
Commercial Metals Q1 2025 Earnings Report
Reported a net loss impacted by litigation expense but achieved adjusted earnings and strong cash flow.
Key Takeaways
Commercial Metals Company reported a first-quarter net loss of ($175.7) million, or ($1.54) per diluted share, which included a $265.0 million litigation expense. Adjusted earnings were $88.5 million, or $0.78 per diluted share. The company generated $213.0 million in cash flow from operating activities and returned $71.0 million to shareholders through dividends and share buybacks.
First quarter net loss of ($175.7) million, or ($1.54) per diluted share including approximately $265.0 million litigation expense, net of estimated tax; adjusted earnings of $88.5 million, or $0.78 per diluted share.
Consolidated core EBITDA of $210.7 million in the first quarter; core EBITDA margin of 11.0%.
Late season construction activity drove year-over-year and sequential growth in North America finished steel shipment volumes; margins pressured by declines in average steel and downstream product pricing.
Generated $213.0 million of cash flow from operating activities in the first quarter, equal to 101% of consolidated core EBITDA; returned $71.0 million in cash to shareholders through dividends and share buybacks
Revenue by Segment
Forward Guidance
The company anticipates a decline in consolidated financial results in the second quarter of fiscal 2025 compared to the first quarter. Finished steel shipments within the North America Steel Group are expected to follow normal seasonal trends, with a sequential decrease in adjusted EBITDA margin due to lower margins over scrap cost on steel and downstream products. Adjusted EBITDA for the Europe Steel Group is projected to align with the prior year's second quarter, supported by stringent cost management. The Emerging Businesses Group's financial results are expected to be impacted by normal seasonality.
Positive Outlook
- Recent conversations with customers reflect optimism about the coming quarters.
- Key indicators of the construction pipeline point in a positive direction.
- Measures of both big and small business confidence have improved significantly over the last two months.
- A palpable shift in sentiment gives us confidence that current softness is transient.
- The company expects to soon enter a period of renewed strength in our core markets.
Challenges Ahead
- Consolidated financial results in the second quarter of fiscal 2025 are expected to decline from the first quarter level.
Revenue & Expenses
Visualization of income flow from segment revenue to net income
Historical Earnings Impact
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Avg. Return Before/After Earnings
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