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Dec 28, 2019
Insteel Q1 2020 Earnings Report
Insteel's Q1 2020 results were affected by low-priced import competition.
Key Takeaways
Insteel Industries reported a decrease in net earnings to $0.6 million, or $0.03 per share, compared to $4.1 million, or $0.21 per share, in the same period last year. Net sales also decreased by 6.3% to $97.6 million, driven by a decrease in average selling prices.
Net earnings decreased to $0.6 million, or $0.03 per share.
Net sales decreased 6.3% to $97.6 million.
Shipments increased 11.7% year-over-year.
Gross margin narrowed to 6.4% due to lower spreads between selling prices and raw material costs.
Forward Guidance
Insteel expects to benefit from continued growth in infrastructure construction and make progress on the expansion of their cast-in-place business. However, markets susceptible to imports will continue to be unfavorably impacted by increased pricing pressure.
Positive Outlook
- Continued growth in infrastructure construction driven by higher state and local spending.
- Modest increases in nonresidential construction.
- Significant progress on the expansion of cast-in-place business.
- Further penetration of the rebar market.
- ESM can serve as a more cost-effective solution for many concrete reinforcing applications.
Challenges Ahead
- Markets susceptible to imports will continue to be unfavorably impacted by increased pricing pressure.
- Pricing pressure due to Section 232 tariffs.
- Uncertainty regarding the resolution of Section 232 tariffs.
Historical Earnings Impact
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Avg. Return Before/After Earnings
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