A.M. Castle names new CEO, reports improved 3Q results
Global metal and plastics manufacturer A.M. Castle of Oak Brook, has named Scott J. Dolan as the company's new chief executive officer.
Dolan, 41, replaces Michael H. Goldberg, who resigned last May after the board of directors decided on a new strategy to improve results
"Scott Dolan possesses the qualities we sought in a CEO to execute A. M. Castle's strategy, engage our employees and deliver improved results for shareholders," said Brian P. Anderson, A.M. Castle board chairman.
The announcement was made as the company reported improved third quarter sales results, primarily on the acquisition of Tube Supply last December and increased business from the auto industry.
Total net sales were $304 million for the quarter, compared to $294.9 million in the third quarter of 2011. Reported net income for the quarter was $3.2 million, or 13 cents per diluted share, compared to $3.8 million, or 16 cents per diluted share, in the prior year quarter.
"We made progress toward our goal to improve operating margins," said Scott Stephens, vice president-finance and CFO and interim CEO during the quarter. "Through strong gross material margin execution and effective cost management, we achieved the third quarter profit levels that we had anticipated, despite external headwinds, including declining scrap and commodity prices and continued uncertain customer demand."
In the company's metals division, third quarter net sales of $272.4 million were up $8.0 million, or 3 percent, from last year. The acquisition of Tube Supply in December 2011 contributed $39.9 million in the third quarter, the company said. Metals segment tons sold per day, excluding Tube Supply, for the third quarter of 2012 were down 9.2 percent from the third quarter of 2011. Tons sold per day, excluding Tube Supply, were 7.6 percent lower than the pervious quarter as customers adjusted inventory levels due to a more cautious outlook.
In the plastics division, third quarter 2012 net sales of $31.6 million were up $1.1 million, or 3.6 percent than the prior year period, primarily due to increased volume in the automotive sector.
Equity in earnings of the company's joint venture was $1.4 million in the third quarter of 2012, $1.8 million less than the same period last year and $400.000 less than the second quarter of this year.
Stephens said the company will remain cautious in the fourth quarter, which has historically been seasonally slower.
"Nevertheless, we expect daily sales in the fourth quarter of 2012 to be comparable to third quarter levels and expect gross material margins in the fourth quarter of approximately 27 percent," Stephens said. "We continue to be optimistic about our global growth opportunities in our targeted end markets, and we are committed to expanding our business as we focus on cost management and improved operating efficiency for the balance of 2012 and into 2013."
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