Schnitzer Steel Industries, reported earnings per share from continuing operations of $0.41 for the fiscal 2016 third quarter ended May 31, 2016.
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This compares to reported losses per share from continuing operations of $0.31 in the third quarter of fiscal 2015 and $1.48 in the second quarter of fiscal 2016.
Adjusted earnings per share from continuing operations of $0.46 for the third quarter fiscal 2016 excludes the adverse impact of noncash write-off of debt issuance costs, restructuring charges and other exit-related costs, and other items.
This compares to adjusted earnings per share from continuing operations of break-even for the third quarter fiscal 2015 and an adjusted loss per share from continuing operations of $0.25 in the second quarter of fiscal 2016.
Consolidated selling, general and administrative expense in the third quarter of fiscal 2016 was higher sequentially primarily due to additional accruals for incentive compensation as a result of significantly improved performance during the quarter.
The company is on schedule to deliver the additional $30 million of annual cost savings which were announced in the second quarter. During the third quarter, Schnitzer Steel achieved a quarterly run rate of $6 million related to such cost savings, with the balance expected to be delivered by the end of fiscal 2017.
The company incurred restructuring charges and other exit-related costs of $1 million in the third quarter of fiscal 2016.
Through the third quarter, Schnitzer Steel generated positive operating cash flow of $51 million, with $4 million in the third quarter. The company returned capital to shareholders through its 89th consecutive quarterly dividend. Total debt at the end of the third quarter was $203 million and net debt was $196 million. (See Non-GAAP Financial Measures for reconciliation to U.S. GAAP.)
The company's effective tax rate was an expense of 0.8% in the third quarter which was lower than the federal statutory rate primarily due to projected changes in Schnitzer Steel’s full valuation allowance positions, partially offset by increases in deferred tax liabilities. ■