Profits plunged at steel processor Worthington Industries as sales dropped sharply and results were hit by a variety of charges.

 

Worthington netted profits of just $1.6 million in its fiscal third quarter, the three months ended February 28, compared with profits of $18.3 million in fiscal Q3 2008. Sales fell 31% to $501.1 million from $725.7 million in the year ago period.

 

Business segment performance was down across the board. In the Steel Processing segment, quarterly net sales fell 45%, or $157.9 million, to $192.5 million from $350.4 million in fiscal Q3 2008. Volumes fell 57% and were weak in all customer categories, including automotive and construction -- the two largest customer groups served by this segment. While average selling prices were higher than in the prior year period, they continued to fall throughout the quarter, Worthington said in its earnings statement.

 

In the Metal Framing segment, net sales dropped 25%, or $45.6 million, to $137.2 million from $182.8 million in fiscal Q3 2008. The decrease in net sales was due to 38% lower volumes associated with slowing construction activity, according to the company. In the Pressure Cylinders segment, sales slid 15%, or $20.8 million, to $117.5 million from $138.3 million in fiscal Q3

2008. The company said volumes were down in most product lines.

 

For the nine-months ended February 28, net loss was $94.5 million, compared to profits of $53.2 million in the same period last year. Net sales of $2.16 billion were down 2% from $2.19 billion in the year ago period. Year-to-date results were hurt by a pre-tax inventory write-down of $98.7 million; a pre-tax goodwill impairment charge of $96.9 million; and pre-tax restructuring charges of $37 million.

 

Columbus, Ohio-based Worthington employs about 7,000 people in 61 facilities across 10 countries and says it has annual sales of approximately $3 billion. –Platts