Commercial Metals Co. has announced plans to exit the joist and deck business through either the sale and/or closure of the facilities.
Murray McClean, chairman, president, and CEO, said, "We continue to review our product lines, geographic dispersion, and vertical integration consistent with our strategic plan to determine the best allocation of resources for the company. The outlook for joist consumption in the North American markets is weak. This product line has suffered low demand, depressed prices, and shrinking margins -- all leading to unacceptable losses. By exiting this business, we believe the capital invested in these operations will be better deployed in our other downstream fabricating operations."
The company also announced that it has amended its agreement regarding its $400 million revolver and its $100 million accounts receivable securitization agreement. The amendments eliminate the EBITDA to interest coverage covenant test for the second fiscal quarter and set the coverage at 2.5 times for future periods.
William Larson, senior VP and CFO, said, "We value the strong relationships with our banking group and appreciate their timely response to our need for an amendment to these agreements for the second fiscal quarter and future periods."
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