Ryerson Q2 revenue rises 28% after Olympic Steel merger

Overview

• U.S. industrial metals distributor's Q2 revenue rose 28% sequentially after Olympic Steel merger

• Adjusted EPS for Q2 climbed to $0.52 from $0.30 in prior quarter

• Company realized $5 mln in Q2 synergies, expects to exceed first-year synergy target

Outlook

• Ryerson expects Q3 shipments to decline 3% to 5% sequentially due to normal seasonality

• Company sees Q3 net sales between $1.87 bln and $1.95 bln

• Ryerson expects Q3 net income of $19 mln to $21 mln, or $0.37 to $0.40 per share

Result Drivers

• OLYMPIC STEEL MERGER - Olympic Steel contributed $564 mln in revenue and $23.5 mln in adjusted EBITDA, with integration driving $5 mln in Q2 synergies

• HIGHER VOLUMES AND PRICES - Total tons shipped rose 22.6% and average selling prices increased 4.5% sequentially, with carbon steel, aluminum and stainless steel all posting gains

• MIXED DEMAND AND SUPPLY CONSTRAINTS - Demand was strong in data center and power generation projects but uneven in traditional markets; tight domestic supply and supply disruptions supported higher prices

Company press release: ID:nPn15yjKya

Key Details

Analyst Coverage

• The current average analyst rating on the shares is "hold" and the breakdown of recommendations is no "strong buy" or "buy", 2 "hold" and no "sell" or "strong sell"

• The average consensus recommendation for the iron steel peer group is "buy"

• Wall Street's median 12-month price target for Ryerson Holding Corp is $29.00, about 6.5% below its July 28 closing price of $31.03

• The stock recently traded at 17 times the next 12-month earnings vs. a P/E of 16 three months ago

Reuters Recommended Reads

• July 29 - France's Constellium Q2 profit surges on higher metal prices

• July 29 - Netherlands' AMG Q2 revenue rises on growth in lithium, vanadium segments

• July 28 - PACCAR beats quarterly estimates on strong truck orders

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(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)