Commercial Metals Reports Record Earnings

Commercial Metals Company, Irving, Texas, today reported net earnings of $50.9 million or $1.69 per diluted share on net sales of $1.4 billion for the quarter ended May 31, 2004, earning more this quarter than any complete year in the Company's history.  This compares with net earnings of $3.0 million or $0.11 per diluted share on net sales of $774 million for the third quarter last year.

Net earnings for the nine months ended May 31, 2004, were $84.7 million or
$2.85 per diluted share on net sales of $3.3 billion.  This far surpassed any
previous nine-month period.  For the same period last year net earnings
were $8.2 million or $0.28 per diluted share on net sales of $2.1 billion.

The quarter included a pre-tax LIFO expense of $25 million ($0.54 per
diluted share) compared to pre-tax LIFO expense of $5.2 million ($0.12 per
diluted share) in the prior year quarter.  Comparable numbers for the nine
months were $35.8 million expense ($0.78) this year and $8.0 million expense
($0.18) in the previous year's nine months.

"The essence of the quarter was the winning combination of high prices, high margins, high production, and high shipments in most of our businesses.  This was most pronounced with steel mill products and steel scrap.  The net result was a surge in profits for our Recycling and Domestic Mills segments," CMC Chairman, President and CEO Stanley A. Rabin says.  "Profits in the Fabrication segment also improved despite the rapid increase in steel costs.  Meanwhile, we attained record profitability in the Marketing and Distribution segment, and results for our Polish steel manufacturing acquisition, CMC Zawiercie (CMCZ), were excellent."

Rabin adds that the strong markets were supported by continued robust demand in Asia (especially China), the upturn in the U.S. economy, the weak U.S. dollar, historically high freight rates and low end-user inventories. 

"Measures taken by the Central Government in China to moderate the pace of growth in the surging Chinese economy generally cooled global price levels for commodities during the quarter," he says. "Our tax rate for the quarter was lower due to an effective tax rate of 20% in Poland and an increase in export sales."

Rabin adds, "The Recycling segment recorded a best ever quarter,

Rabin continues, "During the third quarter we saw a number of our market
prices reach record highs, followed by an anticipated price correction in some
of these markets; however, still at relatively high levels.  Steel prices in
the U.S. are firm and generally stronger than elsewhere.  Our steel scrap
prices were up modestly in June, and it now appears will be up in July as
well.  Conversely, overseas steel scrap prices have continued to move lower.
Nonferrous prices have been in a trading range.  Overall, our outlook for the

CMC will host a live broadcast of its third quarter 2004 conference call on Tuesday, June 22, at 3:00 p.m. eastern time.  The call will be hosted
by Rabin and Bill Larson, vice president and CFO, and can be accessed online at http://www.commercialmetals.com or at http://www.streetevents.com . 

Commercial Metals Company and subsidiaries manufacture, recycle and market steel and metal products, related materials and services through a network including steel minimills, steel fabrication and processing plants,
construction-related product warehouses, a copper tube mill, metal recycling
facilities and marketing and distribution offices in the United States and in
strategic overseas markets.