Worthington Industries (WOR) reported a 21% jump in earnings for the first quarter helped by favorable pricing spread in Steel Processing and overall improvements in Pressure Cylinders. Following this, the metals manufacturing company’s stock inched up 0.45% in the premarket session.
Earnings for the quarter climbed 20.7% to $54.9 million or $0.91 per share. The results included net pre-tax impairment and restructuring charges totaling $1.4 million, which lowered earnings per share by $0.01.
Net sales grew 16.5% to $988.1 million, driven by higher average direct selling prices and higher direct volume in Steel Processing and the combination of higher volume and an improved product mix in Pressure Cylinders.
Gross margin increased by 8% year-over-year as a favorable pricing spread in Steel Processing and overall improvements in Pressure Cylinders were partially offset by declines at Engineered Cabs. Pricing spreads in Steel Processing benefited from significant inventory holding gains in the current quarter.
Steel Processing’s net sales grew 22% year-over-year driven by higher average direct selling prices and higher direct volume. Spreads in the current quarter benefited from significant inventory holding gains due to rising steel prices but were partially offset by softer scrap prices and unfavorable mark-to-market price adjustments on certain raw materials.
Pressure Cylinders’ net sales increased 11% on higher average selling prices and a favorable product mix in the industrial products business and higher volumes in consumer products. However, Engineered Cabs’ net sales fell by 14% due to lower volume.
Income tax expense rose to $14.5 million from $13.0 million in the prior year quarter. This was due primarily to the impact of favorable discrete items in the prior year quarter and higher earnings in the current quarter, partially offset by a lower statutory federal corporate income tax rate.
Shares of Worthington ended Tuesday’s regular session up 1.45% at $46.30 on the NYSE. The stock had risen over 5% for the year so far, while it had fallen more than 8% for the past year.