Metalico Reports Third Quarter Numbers

Revenue and operating income for the quarter were $41.5 million and $3.6 million, representing an increase of 52 percent and 16 percent, respectively, over revenues of $27.4 million and $3.1 million in operating income from the same period for the year prior.

Revenues and income from continuing operations for the nine months ended Sept. 30, 2005, were $122.7 million and $4.9 million compared to $7 million and $4.9 million for the same period of 2004.

During the nine months ended Sept. 30, 2005, Metalico's operating activities generated EBITDA of $12.7 million compared to $9.7 million EBITDA generated in the nine months ended Sept. 30, 2004, an increase of 31 percent. Metalico defines EBITDA as earnings before interest, taxes, depreciation, amortization, non-cash and non-recurring expense (income), income from joint ventures, gain (loss) on sale of fixed assets and other income (expense).

During the third quarter, Metalico reports that its scrap metal segment experienced year-over-year unit volume increases of approximately 23 percent for ferrous and 15 percent for nonferrous. However, these benefits were partly offset by lower ferrous selling prices, which decreased by 24 percent compared to the prior year's quarter, while nonferrous pricing improved by only12 percent in the comparable time frame, according to the company. 

Metalico President and CEO Carlos E. Aguero says, "Given the volatility of ferrous commodity prices which has persisted throughout the year, we are happy to report continued stable operating results as we look to further grow our company with disciplined and strategic acquisitions. We will continue to pursue growth opportunities in the Western New York markets to leverage on our existing presence there. In the meantime, we will continue executing our business plan borne out of a two-industry-segment operation, handling a diverse mix of commodity metals and products."

Due to the Sept. 30, 2004, Mayco joint venture acquisition (which changed the way Metalico reports income and revenue for its Mayco investment), Metalico says its segment sales and operating income have become more evenly divided in accordance with the its strategy of maintaining a balanced mix of commodities in its revenue stream. For the nine months ended Sept. 30, 2005, Metalico's lead fabrications segment represented 46 percent of revenue, and scrap metal recycling was 54 percent. For the same period in 2004, the Metalico derived 27 percent of revenue from lead fabrication operations and 73 percent from scrap metal recycling. Operating income after corporate overhead allocations was 41 percent for fabricating compared to 59 percent for the scrap metal segment for the nine months ended Sept. 30, 2005.

In each of the first three quarterly periods of 2005, Metalico's operating results were negatively impacted by non-recurring after-tax charges totaling $595,000, or $.02 per share, including debt conversion costs, a previously announced EPA settlement and other one time charges.

Metalico Inc. is a holding company with operations in ferrous and nonferrous scrap metal recycling and in fabrication of lead-based products. It operates six recycling facilities and six lead fabrication plants in six states.