http://www.morningstar.com/earnings/50311447-commercial-metals-co-cmc-q2-2013.aspx

Commercial Metals Co CMC
Q2 2013 Earnings Call Transcript

Transcript Call Date 03/28/2013

Operator: Hello, and welcome everyone to today's Commercial Metals Company Second Quarter 2013 Earnings Call. As always, today's call is being recorded. After the Company's remarks, we will have a question-and-answer session, and we'll have a few instructions at that time.

I would like to remind all participants that during the course of this conference call, the Company will make statements that provide information other than historical information and will include expectations regarding the Company's future prospects, revenues, expenses or profits. These statements are considered forward-looking statements and may involve speculation and are subject to risks and uncertainties that could cause actual results to differ materially from these expectations. These statements reflect the Company's beliefs based on current conditions but are subject to certain risks and uncertainties that are listed in the Company's press release and described in the Company's latest 10-K. Although CMC believes these statements are made based on management's expectations and assumptions, CMC offers no assurance that events or facts will happen as expected. All statements are made only as of this date. CMC does not assume any obligation to update them in connection with future events, new information or otherwise.

Some numbers presented will be non-GAAP financial measures and reconciliations can be found in the Company's press release and on the Company's website.

Now for opening remarks and introductions, I would turn the call over to President and CEO of Commercial Metals Company, Mr. Joe Alvarado.

Joseph Alvarado - President and CEO: Good morning. Thank you for joining us to review CMC's fiscal 2013 second quarter results. I'll begin with highlights from quarter and Barbara will then provide further financial details relative to the results. Following Barbara I will close out with comments on our outlook for the third quarter of fiscal 2013, after which we will open the call to questions.

In our results for the quarter as detailed in our earnings release this morning, we reported net sales of $1.7 billion for our fiscal 2013 second quarter, a decrease of 12% from net sales of $2 billion for the second quarter of fiscal 2012. Sales were down across most segments with the international segment having experienced the most difficult – had more significant sales decline when compared to the segment's strong second quarter last year. On the other hand, we did see an upward trend in sales in Americas Fabrication segment which is indicative of the emerging U.S. construction recovery.

For our fiscal second quarter, we reported net earnings of $4.6 million or $0.04 per share. While markets remain volatile, we are pleased to report a sixth consecutive quarter of profitability. As indicated in the earnings release, the Board of Directors declared our regular quarterly dividend of $0.12 per share for shareholders of record on April 9, 2013. The dividend will be paid on April 23, 2013.

As we anticipated and communicated when we last spoke in January, our fiscal second quarter results are affected by the normal seasonal effects of the winter and holiday month. This year's second quarter was no exception. In fact, we continue to see extended winter weather conditions in Poland which are also affecting the start of our fiscal third quarter. Ongoing economic challenges in the Eurozone and Australia and uncertain growth prospects in China also adversely affected second quarter results.

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