Schnitzer Steel (SCHN) Q2 2021 Financial Results Analysis

Schnitzer Steel Industries (NASDAQ:SCHN) traces its roots back to 1906 when a Russian immigrant, named Sam Schnitzer, started a scrap business. He initially used to buy and sell the scrap metal in Portland, Oregon. The family business flourished over the years as Sam’s sons stepped into new segments such as recycling, shipping, and real estate. Today, Schnitzer Steel is a leading scrap metal recycler engaged in the collection, processing, and sale of steel.

The Portland, Oregon-based company recently announced better-than-expected financial results for the second quarter.  Schnitzer reported earnings of $1.54 per share for the three months ended February 28, well above 14 cents per share in the comparable period of 2020. On an adjusted basis, Schnitzer earned $1.51 per share, as compared to 31 cents per share in the year-ago quarter. Analysts on average were looking for earnings of 99 cents per share.

Revenue jumped more than 35 percent on a year-over-year basis to $600.1 million, beating the consensus forecast of $597 million. Schnitzer’s strong quarterly performance was mainly driven by elevated demand for its recycled metals and steel products, as well as record selling prices for ferrous and nonferrous scrap.

CEO Tamara Lundgren expressed satisfaction over the results. Lundgren said in a statement, “We are exceptionally pleased with our performance during the quarter, reflecting our best operating income per ton since 2008. This is a testament to the strength and agility of our team in leveraging positive market conditions while delivering on our operational and strategic initiatives. Since the end of the second quarter, we have commissioned two of the advanced metal recovery technology systems which are key to the execution of our strategic plan and the achievement of our Sustainability goals.”