Oregon Steel Mills Announces First Quarter Results

Oregon Steel Mills, Inc. reported first quarter net income of $7.5 million, compared to a net loss of $9 million for the first quarter of 2003.

Sales for the first quarter were $252.4 million. This compares to 2003 first quarter sales of $175.7 million. Average sales price per ton in the first quarter of 2004 was $529 compared to $440 in the first quarter of 2003. Overall shipments for the first quarter of 2004 were 476,500 tons compared to 2003 first quarter shipments of 399,200 tons.

The shipment increase was primarily due to increased shipments of plate, coil, welded pipe, structural tubing and rod products partially offset by lower rail and seamless pipe shipments. The increase in sales and average sales price were primarily due to higher average selling prices for plate, coil, rail and rod and bar products and the increased shipments noted above, partially offset by lower average selling prices for welded and seamless pipe.

Since January 1, the company has announced numerous price increases on plate and coil products, increasing the base price on as-rolled plate and coil by approximately $210 per ton for March deliveries. Likewise for rod and bar products, price increases and raw material surcharges have increased the base price for these products by approximately $120 per ton for March deliveries. During the quarter, the Company also announced and is implementing price increases for its structural tubing, welded pipe and rail products.

Jim Declusin, Oregon Steel’s president and CEO, said, "We at Oregon Steel are very pleased with the results of our first quarter. While much of our profitability has been fueled by a strong steel demand for our products, resulting in our ability to raise steel prices throughout the quarter, equally important has been the changes the company has made in its culture during the past six months.”

For 2004, the company expects to ship about 1,750,000 tons of products and generate approximately $1 billion in sales. In the Oregon Steel Division the product mix is expected to consist of 630,000 tons of plate and coil, 200,000 tons of welded pipe and 60,000 tons of structural tubing.

At these shipment levels, the company expects its Portland combination mill to run at about 80 percent of its rated capacity and its welded pipe mills to run at about 30 percent of their rated capacities.

The company's RMSM Division expects to ship about 380,000 tons and 482,000 tons of rail and rod and bar products, respectively. At these shipment levels, the rail and rod mills would be at 90 percent and 100 percent, respectively, of their rated capacities. Seamless pipe shipments will be dependent on market conditions in the drilling industry. At the present time the seamless mill is not operating.