Tue, Mar 25, 3:31 PM (32 days ago)
**Commercial Metals Company (CMC, Ticker: CMC)** **Q1 2025 Financial Performance Summary:** **Revenue & Profit Margins:** - Net sales decreased by $93.9 million (5%) for Q1 and $187.4 million (5%) for H1 2025 compared to the corresponding periods in 2024. - Q1 2025 net earnings were $25.5 million, while H1 2025 incurred a net loss of $150.2 million. - The year-over-year decrease in net earnings was primarily due to a $268.0 million litigation expense and compression in steel and downstream products metal margins in the North America Steel Group. **Cash Flow:** - Net cash flows from operating activities were $245.5 million for H1 2025, down from $350.0 million in H1 2024. - The decrease was due to lower net earnings and changes in operating assets and liabilities. **Segment Performance:** - **North America Steel Group:** Net sales decreased by 7% (Q1) and 6% (H1) due to reduced average selling prices per ton. Adjusted EBITDA decreased by 42% (Q1) and 35% (H1) due to metal margin compression. - **Europe Steel Group:** Net sales increased by 3% (Q1) but decreased by 2% (H1). Adjusted EBITDA increased by 109% (Q1) but decreased by 12% (H1) due to reduced government assistance. - **Emerging Businesses Group:** Net sales were relatively flat. Adjusted EBITDA increased by 31% (Q1) but decreased by 5% (H1). **Future Operations & Uncertainties:** - CMC is executing its Transform, Advance and Grow (TAG) initiative to enhance operational value. - Capital expenditures for 2025 are estimated to range from $550 million to $600 million. - The company faces uncertainties related to macroeconomic trends, geopolitical conditions, and litigation risks, particularly the ongoing Pacific Steel Group (PSG) lawsuit. **Liquidity & Capital Resources:** - CMC has sufficient liquidity to maintain operations, make necessary capital expenditures, and invest in growth initiatives. - The company has remaining authorization to repurchase $305.3 million of shares under its share repurchase program. **Forward-Looking Statements:** - CMC's forward-looking statements are subject to risks and uncertainties, including economic conditions, regulatory changes, and litigation outcomes. - The company's actual results may differ materially from its expectations due to various factors, including those identified in its risk factors.