Worthington Steel, Inc. reported its financial results for the three months ended August 31, 2024, reflecting a challenging period marked by decreased revenues and profitability compared to the same quarter in the previous year. Net sales for the quarter totaled $834.0 million, down from $905.8 million in the prior year, primarily driven by a decline in the automotive sector, which accounted for 51% of consolidated net sales. The company experienced a gross margin of $100.4 million, a decrease from $128.5 million, resulting in an operating income of $43.4 million, down from $69.7 million in the same period of 2023.
Net earnings attributable to controlling interest fell to $28.4 million, compared to $58.5 million in the previous year, with earnings per share decreasing from $1.19 to $0.57. The decline in profitability was attributed to several factors, including a significant inventory holding loss of $16.6 million due to declining steel prices, which averaged $690 per ton in Q1 Fiscal 2025, down from $879 per ton in Q1 Fiscal 2024.
The company’s total current assets decreased to $955.5 million from $1,001.8 million, while total assets also fell to $1,829.4 million from $1,866.4 million. However, total current liabilities decreased to $557.9 million from $618.4 million, contributing to an increase in retained earnings to $106.3 million from $86.1 million. Total shareholders’ equity rose to $1,143.2 million, up from $1,117.5 million.
Strategically, Worthington Steel completed the acquisition of Voestalpine Automotive Components Nagold GmbH & Co. KG for $21.0 million on November 16, 2023, enhancing its capabilities in automotive and electrical steel lamination stampings. The company also reported a cash distribution of $150.0 million to its former parent, Worthington Enterprises, as part of its separation process, which was finalized on December 1, 2023.
In terms of cash flow, Worthington Steel generated $54.6 million from operating activities, a significant improvement from a cash outflow of $20.7 million in the same quarter of the previous year. The company’s cash and cash equivalents at the end of the period stood at $36.0 million, down from $40.2 million at the beginning of the quarter. The company declared a quarterly cash dividend of $0.16 per common share, reflecting its commitment to returning value to shareholders despite the challenging market conditions.
About Worthington Steel, Inc.
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