Company: ZEUS
Filing Date: 2025-05-02
Form Type: 10-Q
Source: 0001437749-25-014325
Chunk: 27

Company: OLYMPIC STEEL INC
Filing Date: 2025-05-02
Form: 10-Q
Item: Part I, Item 8
Chunk 27
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 decreases in metals surcharges experienced during 2025. The price of grade 304 stainless steel surcharges decreased by 3.1% between December 2024 and March 2025. Metals index pricing for our carbon flat products segment increased during the first quarter of 2025 by $240 per ton, or 34.7%. However, metals index prices were 15.8% lower in the first quarter of 2025 compared to the first quarter of 2024. The decrease in year-over-year industry metals pricing decreased both our average selling prices and average cost of materials sold in each operating segment in 2025 when compared to 2024. Metals pricing for the tubular and pipe products segment lags behind the carbon flat products segment by several months. 

Transactional or “spot” selling prices generally move in tandem with market price changes, while fixed selling prices typically lag and reset quarterly. Similarly, inventory costs (and, therefore, cost of materials sold) tend to move slower than market selling price changes due to mill lead times and inventory turnover impacting the rate of change in average cost. When average selling prices decrease, and net sales decrease, gross profit and operating expenses as a percentage of net sales will generally increase. 

Consolidated Operations

The following table presents consolidated operating results for the periods indicated (dollars are shown in thousands):

      For the Three Months Ended March 31, 

      2025 

      2024 

      % of net 

      % of net 

      $ 

      sales 

      $ 

      sales 

      Net sales 
      
     $
     492,941

     100.0

     $
     526,642

     100.0

      Cost of materials sold (a) 

     374,500

     76.0

     407,538

     77.4

      Gross profit (b) 

     118,441

     24.0

     119,104

     22.6

      Operating expenses (c) 

     110,648

     22.4

     103,166

     19.6

      Operating income 

     7,793

     1.6

     15,938

     3.0

      Other loss, net 

     21

     0.0

     19

     0.0

      Interest and other expense