{"id":401587,"date":"2020-12-17T06:48:18","date_gmt":"2020-12-17T11:48:18","guid":{"rendered":"http:\/\/www.marketnewsdesk.com\/?p=401587"},"modified":"2020-12-17T06:48:18","modified_gmt":"2020-12-17T11:48:18","slug":"worthington-reports-second-quarter-fiscal-2021-results","status":"publish","type":"post","link":"https:\/\/www.marketnewsdesk.com\/index.php\/worthington-reports-second-quarter-fiscal-2021-results\/","title":{"rendered":"Worthington Reports Second Quarter Fiscal 2021 Results"},"content":{"rendered":"
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COLUMBUS, Ohio, Dec. 17, 2020 (GLOBE NEWSWIRE) — Worthington Industries, Inc. (NYSE: WOR) today reported net sales of $731.1 million and a net loss of $74.0 million, or $(1.40) per diluted share, for its fiscal 2021 second quarter ended November 30, 2020. In the second quarter of fiscal 2020, the Company reported net sales of $827.6 million and net earnings of $52.1 million, or $0.93 per diluted share. Results in both the current and prior year quarter were impacted by several unique items, as summarized below, including a combined pre-tax loss of $148.4 million, or $(2.18) per diluted share, in the current quarter related to the Company\u2019s investment in Nikola Corporation (\u201cNikola\u201d). See Recent Developments below for further information regarding the Company\u2019s investment in Nikola.\u00a0\u00a0<\/p>\n

\n (U.S. dollars in millions, except per share amounts)<\/em>\n <\/p>\n\n\n\n\n\n\n\n\n
\u00a0<\/td>\n\u00a0<\/td>\n\n 2Q 2021<\/strong>\n <\/td>\n\u00a0<\/td>\n\n 2Q 2020<\/strong>\n <\/td>\n\u00a0<\/td>\n<\/tr>\n
\u00a0<\/td>\n\u00a0<\/td>\n\n Pre-Tax<\/strong>\n <\/td>\n\u00a0<\/td>\n\n EPS<\/strong>\n <\/td>\n\u00a0<\/td>\n\n Pre-Tax<\/strong>\n <\/td>\n\u00a0<\/td>\n\n EPS<\/strong>\n <\/td>\n\u00a0<\/td>\n<\/tr>\n
Impairment and restructuring charges<\/td>\n\u00a0<\/td>\n$<\/td>\n(11.4<\/td>\n)<\/td>\n\u00a0<\/td>\n$<\/td>\n(0.17<\/td>\n)<\/td>\n\u00a0<\/td>\n$<\/td>\n–<\/td>\n\u00a0<\/td>\n$<\/td>\n–<\/td>\n\u00a0<\/td>\n<\/tr>\n
Incremental expenses related to Nikola gains<\/td>\n\u00a0<\/td>\n\u00a0<\/td>\n(4.6<\/td>\n)<\/td>\n\u00a0<\/td>\n\u00a0<\/td>\n(0.07<\/td>\n)<\/td>\n\u00a0<\/td>\n\u00a0<\/td>\n–<\/td>\n\u00a0<\/td>\n\u00a0<\/td>\n–<\/td>\n\u00a0<\/td>\n<\/tr>\n
Unrealized loss on investment in Nikola<\/td>\n\u00a0<\/td>\n\u00a0<\/td>\n(143.8<\/td>\n)<\/td>\n\u00a0<\/td>\n\u00a0<\/td>\n(2.11<\/td>\n)<\/td>\n\u00a0<\/td>\n\u00a0<\/td>\n–<\/td>\n\u00a0<\/td>\n\u00a0<\/td>\n–<\/td>\n\u00a0<\/td>\n<\/tr>\n
Gain on sale of WAVE international operations<\/td>\n\u00a0<\/td>\n$<\/td>\n–<\/td>\n\u00a0<\/td>\n\u00a0<\/td>\n$<\/td>\n–<\/td>\n\u00a0<\/td>\n\u00a0<\/td>\n$<\/td>\n23.1<\/td>\n\u00a0<\/td>\n$<\/td>\n0.33<\/td>\n\u00a0<\/td>\n<\/tr>\n
\u00a0<\/td>\n\u00a0<\/td>\n\u00a0<\/td>\n\u00a0<\/td>\n\u00a0<\/td>\n\u00a0<\/td>\n\u00a0<\/td>\n\u00a0<\/td>\n\u00a0<\/td>\n\u00a0<\/td>\n\u00a0<\/td>\n\u00a0<\/td>\n\u00a0<\/td>\n\u00a0<\/td>\n\u00a0<\/td>\n\u00a0<\/td>\n<\/tr>\n<\/table>\n

Financial highlights for the current and comparative periods are as follows:<\/p>\n

\n (U.S. dollars in millions, except per share amounts)<\/em>\n <\/p>\n\n\n\n\n\n\n\n\n
\u00a0<\/td>\n\u00a0<\/td>\n\n 2Q 2021<\/strong>\n <\/td>\n\u00a0<\/td>\n\n 2Q 2020<\/strong>\n <\/td>\n\u00a0<\/td>\n\n 6M 2021<\/strong>\n <\/td>\n\u00a0<\/td>\n\n 6M 2020<\/strong>\n <\/td>\n\u00a0<\/td>\n<\/tr>\n
Net sales<\/td>\n\u00a0<\/td>\n$<\/td>\n731.1<\/td>\n\u00a0<\/td>\n\u00a0<\/td>\n$<\/td>\n827.6<\/td>\n\u00a0<\/td>\n\u00a0<\/td>\n$<\/td>\n1,434.0<\/td>\n\u00a0<\/td>\n$<\/td>\n1,683.5<\/td>\n\u00a0<\/td>\n<\/tr>\n
Operating income<\/td>\n\u00a0<\/td>\n\u00a0<\/td>\n37.4<\/td>\n\u00a0<\/td>\n\u00a0<\/td>\n\u00a0<\/td>\n32.1<\/td>\n\u00a0<\/td>\n\u00a0<\/td>\n\u00a0<\/td>\n7.2<\/td>\n\u00a0<\/td>\n\u00a0<\/td>\n17.5<\/td>\n\u00a0<\/td>\n<\/tr>\n
Equity income<\/td>\n\u00a0<\/td>\n\u00a0<\/td>\n25.6<\/td>\n\u00a0<\/td>\n\u00a0<\/td>\n\u00a0<\/td>\n47.3<\/td>\n\u00a0<\/td>\n\u00a0<\/td>\n\u00a0<\/td>\n49.3<\/td>\n\u00a0<\/td>\n\u00a0<\/td>\n72.1<\/td>\n\u00a0<\/td>\n<\/tr>\n
Net earnings (loss)<\/td>\n\u00a0<\/td>\n\u00a0<\/td>\n(74.0<\/td>\n)<\/td>\n\u00a0<\/td>\n\u00a0<\/td>\n52.1<\/td>\n\u00a0<\/td>\n\u00a0<\/td>\n\u00a0<\/td>\n542.6<\/td>\n\u00a0<\/td>\n\u00a0<\/td>\n47.3<\/td>\n\u00a0<\/td>\n<\/tr>\n
Earnings (loss) per diluted share<\/td>\n\u00a0<\/td>\n$<\/td>\n(1.40<\/td>\n)<\/td>\n\u00a0<\/td>\n$<\/td>\n0.93<\/td>\n\u00a0<\/td>\n\u00a0<\/td>\n$<\/td>\n9.97<\/td>\n\u00a0<\/td>\n$<\/td>\n0.84<\/td>\n\u00a0<\/td>\n<\/tr>\n
\u00a0<\/td>\n\u00a0<\/td>\n\u00a0<\/td>\n\u00a0<\/td>\n\u00a0<\/td>\n\u00a0<\/td>\n\u00a0<\/td>\n\u00a0<\/td>\n\u00a0<\/td>\n\u00a0<\/td>\n\u00a0<\/td>\n\u00a0<\/td>\n\u00a0<\/td>\n\u00a0<\/td>\n\u00a0<\/td>\n\u00a0<\/td>\n<\/tr>\n<\/table>\n

\u201cWe had an outstanding second quarter, despite some noise in the numbers, due to continued great work by our teams as we navigate the challenges of the ongoing COVID-19 pandemic,\u201d said President & CEO Andy Rose.\u00a0 \u201cSteel Processing delivered strong year over year earnings growth, aided by stable automotive and construction demand and improving agricultural demand.\u00a0 Pressure Cylinders continued to experience solid demand for its consumer products, particularly for portable propane and helium products, while headwinds persisted in Europe and the oil & gas business.\u201d\u00a0 \u00a0\u00a0\u00a0<\/p>\n

\n Consolidated Quarterly Results<\/strong>
\n \n <\/p>\n

Net sales for the second quarter of fiscal 2021 were $731.1 million, down 12% from the comparable quarter in the prior year, when net sales were $827.6 million. The decrease was driven primarily by lower average selling prices in Steel Processing, lower volumes in the oil and gas equipment business in Pressure Cylinders, and the divestiture of the engineered cabs business in the prior year.\u00a0\u00a0
\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0
Gross margin increased $14.9 million over the prior year quarter to $135.5 million as lower conversion costs and improved spreads in Steel Processing were partially offset by a decline in the oil and gas equipment business in Pressure Cylinders. \u00a0\u00a0<\/p>\n

Operating income for the current quarter was $37.4 million, an increase of $5.2 million over the prior year quarter. The impact of higher gross margin and lower SG&A expense was partially offset by higher combined impairment and restructuring charges, and the profit sharing and bonus expenses related to the Company\u2019s investment in Nikola.<\/p>\n

Interest expense was $7.5 million for the current quarter, compared to $7.3 million in the prior year quarter. The increase was due primarily to higher average debt levels.<\/p>\n

Equity income from unconsolidated joint ventures decreased $21.7 million from the prior year quarter, which included a $23.1 million pre-tax gain related to the sale of WAVE\u2019s international operations. Excluding the gain in the prior year quarter, equity income increased $1.4 million primarily due to higher contributions from Serviacero. The Company received cash distributions of $30.2 million from its unconsolidated joint ventures during the quarter.<\/p>\n

Income tax benefit was $19.4 million in the current quarter compared to income tax expense of $15.9 million in the prior year quarter. The current quarter income tax benefit was due to the unrealized mark-to-market loss on the Company\u2019s investment in Nikola. Tax expense in the current quarter reflects an estimated annual effective rate of 21.5% compared to 24.8% for the prior year quarter.<\/p>\n

\n Balance Sheet<\/strong>\n <\/p>\n

At quarter-end, total debt was $707.5 million, relatively consistent with debt at August 31, 2020, and the Company had $713.1 million of cash.\u00a0\u00a0<\/p>\n

\n Quarterly Segment Results<\/strong>\n <\/p>\n

Steel Processing\u2019s net sales totaled $468.7 million, down 9%, or $48.2 million, from the comparable prior year quarter driven by lower average selling prices. Operating income of $37.8 million was $20.7 million higher than the prior year quarter as the impact of lower average selling prices was more than offset by lower conversion costs, improved spreads, and the lack of inventory holding losses, which negatively impacted the prior year quarter by an estimated $6.5 million. The mix of direct versus toll tons processed was 48% to 52% in the current quarter, compared to 49% to 51% in the prior year quarter.\u00a0\u00a0<\/p>\n

Pressure Cylinders\u2019 net sales totaled $262.3 million, down 10%, or $27.9 million, from the comparable prior year quarter due primarily to lower volume in the oil and gas equipment business. Operating income of $3.3 million was $12.3 million less than the prior year quarter. The decrease was driven by current quarter impairment and restructuring charges, which totaled $11.1 million, and lower volume in the oil and gas equipment business, partially offset by lower SG&A expense and improvements in the industrial products business.<\/p>\n

\n Recent Developments<\/strong>\n <\/p>\n