IRVING, Texas (AP) -- Commercial Metals said Thursday that its second-quarter net income tumbled 84 percent because and its overseas performance weakened and it had a bigger tax benefit last year.
Chairman, President and CEO Joe Alvarado said in a statement that seasonal softness was expected during the quarter, along with difficulties abroad due to ongoing economic challenges.
The company is optimistic as the construction season starts to ramp up and expects improved demand in the U.S. But it believes that ongoing softness in most overseas markets will continue to hurt its international marketing and distribution unit.
Commercial Metals, which makes, recycles and markets steel and metal products as well as related materials and services, earned $4.6 million, or 4 cents per share, for the three months ended Feb. 28. That compares with earnings of $28.9 million, or 25 cents per share, a year earlier.
Analysts surveyed by FactSet expected earnings of 18 cents per share.
The current quarter included a tax benefit of $4.7 million, compared with a tax benefit of $15 million a year earlier.
The international mill unit moved to an adjusted operating loss from an adjusted operating profit a year ago as volumes fell 16 percent. The international marketing and distribution segment's adjusted operating profit dropped to $3.9 million from $26.6 million a year earlier, hurt by lower revenue and margins in its raw materials business and its Australian operations.
Revenue declined 12 percent to $1.73 billion from $1.96 billion. Wall Street predicted $1.86 billion in revenue.
Sales for the Americas recycling, Americas mills, international mill and international marketing and distribution divisions dropped.
Commercial Metals Co. also declared a quarterly dividend of 12 cents per share. The dividend will be paid April 23 to shareholders of record April 9.
Shares of the Irving, Texas, company fell 39 cents, or 2.4 percent, to $15.87 in midday trading. Over the past year, the stock has traded in a range of $11.30 to $17.47.