European debt crisis hurts Schnitzer Steel

European debt crisis hurts Schnitzer Steel

Schnitzer Steel Industries expects first-quarter earnings to be weaker than expected, due to fallout from the European debt crisis.

Portland, Ore.-based Schnitzer expects first-quarter earnings per share to come in at 18-25 cents, largely due to a 50% drop in operating income per ferrous ton, a figure that was $21 in the first quarter of fiscal 2011.
The European situation is driving a weaker demand environment for recycled metals. “Heightened global recessionary concerns, stemming primarily from the European debt crisis which escalated during the quarter, resulted in a significant slowdown in buying patterns and a sharp decline in sales prices,” the steelmaker said. Operating margins contracted, as inventory costs did not keep up with declining net selling prices.

Read more at Forbes.

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