TimkenSteel reports net income in Q1 after Q4 net loss

TimkenSteel reports net income in Q1 after Q4 net loss

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TimkenSteel reported first-quarter 2021 net sales of $273.6 million and net income of $9.8 million. In the same quarter last year, net sales were $259.7 million with a net loss of $19.9 million. The company’s sequential fourth quarter of 2020 net sales were $211.2 million with a net loss of $12.8 million.

In a press release, the company said net sales of $273.6 million increased 30 percent compared to the fourth quarter of 2020, driven primarily by improved industrial demand and continued strength in automotive demand. Additionally, the average raw material surcharge per ton increased 65 percent sequentially as a result of higher scrap and alloy prices. Compared with the prior-year quarter, net sales increased 5 percent largely driven by a 62 percent increase in the average raw material surcharge per ton as a result of higher scrap and alloy prices, partially offset by lower energy and OCTG billet demand.

Ship tons of 193,400 increased 18 percent sequentially as a result of higher industrial and automotive shipments. When compared with the prior-year quarter, ship tons declined 9 percent due to lower energy and OCTG billet demand, partially offset by higher automotive and industrial shipments.

Manufacturing costs improved sequentially and compared with the prior-year quarter primarily due to higher melt utilization and the impact of systemic cost reduction actions.

As for an outlook, given steady improvement in the automotive and industrial end markets, the company expects second quarter ship tons to increase sequentially by high-single digits on a percentage basis. Additionally, the company expects adjusted EBITDA growth from the first quarter of 2021 with melt utilization of 80 percent or higher.

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