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November 20, 2008


Insteel Industries Q3 sales up by 32% YoY

Insteel Industries, Inc announced financial results for the third quarter ended June 28th 2008. Earnings from continuing operations for the quarter were USD 16.9 million as compared with USD 8.3 million. Net sales for the quarter increased 32.1% YoY to USD 104.3 million from USD 79.0 million last year.

For the nine month period ended June 28th 2008, earnings from continuing operations were USD 28.1 million as compared with USD 19.2 million. Net sales for the nine month period increased 10.8% to USD 247.6 million from USD 223.4 million last year. Average selling prices rose 17.2% while shipments decreased 5.5%.

Gross profit for the quarter increased to USD 30.9 million from USD 17.4 million a year ago due to higher spreads between average selling prices and raw material costs, which more than offset the lower shipments and higher unit conversion costs. The widening in spreads was driven by the price increases that were implemented during the quarter together with the consumption of lower cost inventory under FIFO accounting. Most of the Company's manufacturing facilities continued to operate on reduced schedules in response to the soft demand.

Mr HO Woltz III president & CEO of Insteel said that "We are pleased with Insteel's financial performance for the third quarter, especially in light of the continued escalation in raw material costs and difficult conditions that we experienced in certain of our markets.”

He added that "Additional price increases were implemented across all our product lines during the quarter to recover these added costs and position the Company to achieve satisfactory results when steel and other commodity prices eventually stabilize. Shipments fluctuated within the quarter due to accelerated purchases by customers driven by the unprecedented frequency and magnitude of the price increases, making it difficult to determine the actual consumption trends for our products."
Insteel Industries is one of the nation's largest manufacturers of steel wire reinforcing products for concrete construction applications. It manufactures and markets pre stressed concrete strand and welded wire reinforcement, including concrete pipe reinforcement, engineered structural mesh and standard welded wire reinforcement.