Universal Stainless reportsQ2 results
Universal Stainless & Alloy Products Inc reported that net sales for the second quarter of 2015 were $49.6 million compared with $52.3 million in the second quarter of 2014, and $56.0 million in the first quarter of 2015. Sales of premium alloys totaled $4.2 million, or 8.6% of net sales, in the second quarter of 2015, compared with $4.3 million, or 8.1% of net sales, in the second quarter of 2014, and a record $5.0 million, or 9.0% of net sales, in the 2015 first quarter.
For the first six months of 2015, net sales increased 7% to $105.6 million from net sales of $99.0 million in the same period of 2014. Premium alloy sales were $9.3 million, an increase of 33.5% from the first half of 2014, and represented 8.8% of net sales.
Compared with the second quarter of 2014, sales to the aerospace market were up 1% and heavy equipment market sales were up 35%, while sales to the power generation and oil & gas markets were lower by 23% and 24%, respectively. Sales increased to all targeted markets in the first six months of 2015, with aerospace sales up 13%, power generation sales up 4%, oil & gas sales up 6%, and heavy equipment market sales up 17%. The Company's backlog (before surcharges) at June 30, 2015 was $48.9 million compared with $58.5 million at the end of the first quarter of 2015.
The Company recorded a net loss of $0.4 million, or $0.05 per diluted share, for the second quarter of 2015. That compares with net income of $1.4 million, or $0.20 per diluted share, in the second quarter of 2014, and net income of $0.1 million, or $0.02 per diluted share, in the first quarter of 2015.
The net loss for the first six months of 2015 was $0.2 million, or $0.03 per diluted share, compared with net income of $1.0 million, or $0.13 per diluted share, in the first six months of 2014.
Chairman, President and CEO Dennis Oates commented: "Market conditions were challenging in the second quarter. Commodity prices, especially for nickel, deteriorated further. Oil and gas demand continued to plummet due to market conditions. Customers worked down inventories overall and postponed purchases with the prospect of lower surcharges in coming months. Competition for existing orders intensified. These conditions led to lower market demand and volume in the second quarter throughout the specialty steel sector. Despite the continued challenge of falling commodity prices and the associated cost, we were able to improve our gross margin during the quarter. Our current backlog points towards a challenging third quarter and we have taken steps to reduce spending in line with lower activity levels, and to improve yields and generate cash. There is an emerging view among customers of a potential improvement in demand in the fourth quarter and growing optimism about 2016. We remain committed to our transformation to more higher value products. To date this year, we have successfully launched seven new products with associated customer approvals and made significant strides in continuing to develop our organization for the future. This progress combined with our team's relentless efforts enabled us to grow our premium alloy sales nearly 34% so far this year."
Source : Strategic Research Institute