EPS is $0.52 on Sales of $51.6 Million
Backlog of $69 Million is Highest in Two Years and Up 18% from End of 3Q10
BRIDGEVILLE, Pa., Jan. 26, 2011 (GLOBE NEWSWIRE) -- Universal Stainless & Alloy Products, Inc. (Nasdaq:USAP) reported today that sales for the fourth quarter of 2010 were $51.6 million compared with $26.7 million in the fourth quarter of 2009 and $51.9 million in the 2010 third quarter.
Net income for the fourth quarter of 2010 was $3.6 million, or $0.52 per diluted share, compared with $1.0 million, or $0.14 per diluted share, for the fourth quarter of 2009, and $4.1 million, or $0.60 per diluted share, for the third quarter of 2010.
The Company recorded negative cash flow from operations of $3.6 million in the fourth quarter of 2010 due to its investment in managed working capital to support increased sales activity and backlog. This compares with positive cash flow from operations of $2.3 million in the fourth quarter of 2009. For full year 2010, cash flow from operations was $1.3 million. Capital expenditures for the 2010 fourth quarter were $2.3 million. At December 31, 2010, the Company had cash of $34.9 million and total debt of $10.8 million.
The Company noted that total shipment volume for the fourth quarter of 2010 was 3% lower than the third quarter of 2010, but 84% higher than the fourth quarter a year ago. Compared with the third quarter of 2010, volume shipped to the power generation market increased 22% and petrochemical volume rose 7%, while volumes shipped to the aerospace and service center plate markets were lower by 6% and 54%, respectively.
Chairman, President and CEO Dennis Oates commented: "Our fourth quarter sales were in line with the third quarter as expected and more heavily weighted towards lower margin semi-finished products. Some customers elected to delay December shipments until January as a part of their year-end inventory planning. Order entry from all markets continued to build positive momentum and backlog at the end of the year rose to a two-year high of $69 million."
Mr. Oates concluded: "We have entered 2011 fully focused on seizing the opportunities presented by our strengthening end markets while relentlessly pursing further operating improvements."
For the fourth quarter of 2010, the Universal Stainless & Alloy Products segment had sales of $46.1 million and operating income of $4.2 million, yielding an operating margin of 9.2% of sales. This compares with sales of $23.1 million and operating income of $0.5 million, or 2.2% of sales, in the fourth quarter of 2009. In the third quarter of 2010, sales were $46.2 million and operating income was $4.4 million, or 9.4% of sales.
Segment sales doubled from the fourth quarter of 2009 on a 91% increase in tons shipped mainly due to higher shipments to rerollers, forgers and service centers. Segment sales were level with the third quarter of 2010 on a 3% decrease in tons shipped with higher shipments to forgers and rerollers offset by lower shipments to service centers.
The Dunkirk Specialty Steel segment recorded sales of $17.1 million and operating income of $1.3 million for the fourth quarter of 2010, yielding an operating margin of 7.8% of sales. This compares with sales in the fourth quarter of 2009 of $8.1 million and operating income of $0.2 million, or 2.8% of sales. In the third quarter of 2010, sales were $16.1 million and operating income was $1.4 million or 8.4% of sales.
Dunkirk's sales increased 111% from the fourth quarter of 2009 on a 73% increase in tons shipped mainly due to a doubling of shipments to service centers and higher selling prices. Dunkirk's sales increased 6% from the third quarter of 2010 on a 4% increase in tons shipped, mainly due to higher shipments to forgers and OEMs and higher selling prices.
A simultaneous webcast of the Company's conference call discussing the fourth quarter of 2010, scheduled at 10:00 a.m. (Eastern) today, will be available on the Company's website at , and thereafter archived on the website through the end of the first quarter of 2011.
About Universal Stainless & Alloy Products, Inc.
Universal Stainless & Alloy Products, Inc., headquartered in Bridgeville, Pa., manufactures and markets semi-finished and finished specialty steels, including stainless steel, tool steel and certain other alloyed steels. The Company's products are used in a variety of industries, including aerospace, power generation, petrochemical and heavy equipment manufacturing. Established in 1994, our experience, technical expertise, and dedicated workforce stand committed to providing the best quality, delivery, and service possible. More information is available at www.univstainless.com.
Forward-Looking Information Safe Harbor
Except for historical information contained herein, the statements in this release are forward-looking statements that are made pursuant to the "safe harbor" provision of the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve known and unknown risks and uncertainties that may cause the Company's actual results in future periods to differ materially from forecasted results. Those risks include, among others, risks associated with the receipt, pricing and timing of future customer orders, risks associated with significant fluctuations that may occur in raw material and energy prices, risks associated with the manufacturing process, labor and production yields, risks related to property, plant and equipment, and risks related to the ultimate outcome of the Company's current and future litigation and regulatory matters. The Company's actual results in future periods also may be impacted by various economic and market risk and uncertainties, many of which are beyond the Company's control. Certain of these risks and other risks are described in the Company's filings with the Securities and Exchange Commission (SEC) over the last 12 months, copies of which are available from the SEC or may be obtained upon request from the Company.
CONTACT: Dennis Oates Chairman, President and CEO (412) 257-7609 Douglas McSorley VP Finance, CFO and Treasurer (412) 257-7606 June Filingeri President Comm-Partners LLC (203) 972-0186