The following is a summary of the Worthington Steel, Inc. (WS) Q2 2025 Earnings Call Transcript:
Financial Performance:
Reported earnings of $12.8 million or $0.25 per share in Q2, compared to a $6 million loss or $0.12 per share in the previous year.
Adjusted EBITDA increased to $30.6 million from $23 million in the prior year quarter.
Net sales were $739 million, down $69 million or 9% from the prior year quarter, mainly due to lower direct volumes and lower direct market pricing.
Business Progress:
Advanced in high value-added business by agreeing to acquire a 52% stake in Sitem Group, enhancing the electrical steel lamination business in Europe.
Installed new product capabilities using licensed ablation technology at TWB, staying on schedule.
Released the first Corporate Citizenship and Sustainability Report, showcasing achievements such as reduced carbon emissions and support for non-profits.
Opportunities:
Optimistic about growth in the automotive and construction markets, influenced by lower interest rates and a recovery in demand.
Potential regulatory changes expected to drive growth in heavy truck market segments in the latter part of the year.
Risks:
Persistent headwinds in several markets including automotive, construction, and heavy truck which may affect future quarters.
Noted potential risks from customer-specific financial instabilities that led to increased reserves and bad debt expenses.
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