COLUMBUS - Worthington Steel, Inc. (NYSE:WS) showcased a robust fiscal 2024 third quarter, with significant growth in earnings per share (EPS) and a solid increase in net sales. The company reported an EPS of $0.99, substantially outperforming the analyst consensus of $0.49.
This figure marks a considerable improvement from the $0.11 EPS recorded in the same quarter of the previous year. Net sales also saw an uptick, reaching $805.8 million, which exceeded the consensus estimate of $736 million and represented a 3% increase from the $780.7 million reported in the third quarter of fiscal 2023.
Worthington Steel’s President and CEO, Geoff Gilmore, attributed the strong performance to improvements in sales, operating income, and net income over the previous year's quarter. He commended the employees for their exceptional performance, especially significant as this was the company's first quarter operating independently following its separation from Worthington Enterprises, Inc.
The company's net sales rise was primarily driven by a 1% increase in direct selling prices and an 11% increase in toll selling prices. Volume also contributed to the growth, with a 1% rise in direct tons and a 9% increase in toll tons sold. Gross margin improved by $56.9 million over the prior year quarter, reaching $120.1 million, mainly due to better direct spreads and higher volume.
Operating income for the quarter improved dramatically to $66.3 million, a stark contrast to the $9.5 million reported in the same quarter last year. This increase was primarily due to the improved gross margin and a $3.0 million decrease in costs associated with the company's separation from Worthington Enterprises, Inc.
Looking ahead, Gilmore expressed optimism about the company's future, citing alignment and focus on creating value for shareholders and ensuring the durability and performance of their products. He highlighted the company's growth plans and strategic direction as reasons for his confidence.
Worthington Steel, a North American leader in metals processing, operates 32 facilities across seven states and six countries. The company's commitment to sustainability and its people-first philosophy underscore its mission to provide innovative solutions for its customers, create opportunities for employees, and strengthen communities.
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