Universal Stainless Reports Preliminary Fourth Quarter 2022 Results

BRIDGEVILLE, Pa., Jan. 19, 2023 (GLOBE NEWSWIRE) — Universal Stainless & Alloy Products, Inc. (Nasdaq: USAP) today reported that, based on preliminary results, it expects to report net sales for the fourth quarter of 2022 of $56.2 million, an increase of 22% from the third quarter of 2022, and 30% higher than the fourth quarter of 2021. Sales of premium alloys in the fourth quarter of 2022 are expected to reach a record $13.5 million, or 24% of sales, driven mainly by a 27% sequential increase in sales to the aerospace market.

Gross margin in the fourth quarter of 2022 is expected to approximate $2.4 million, or 4.3% of sales, versus $3.0 million, or 6.4% of sales, in the 2022 third quarter. The sequential decline was mainly due to two factors: negative misalignment between surcharges and material costs of approximately $2.4 million and unplanned outages at key facilities that negatively impacted gross profit by approximately $0.7 million.

As a result, the Company expects to report a net loss for the fourth quarter of 2022 of approximately $3.7 million, or $0.41 per diluted share, compared with a net loss of $1.3 million, or $0.14 per diluted share, in the third quarter of 2022.

Dennis Oates, Chairman, President and CEO, commented: “We achieved noteworthy top-line growth in the fourth quarter including in our strategic growth categories of premium alloys and aerospace. This made our bottom line loss especially disappointing. The main factor was the negative impact of surcharge misalignment. Surcharges were at the lowest level of the year in the fourth quarter due to a drop in commodity prices, at a time that we were shipping products with higher materials cost produced earlier in the year. The outages were also impactful as they occurred at key work centers, caused by equipment breakdowns and freezing weather conditions in December. Although improving, inflation, supply chain and labor issues are lingering challenges.

“With our year-end backlog reaching a record $287.9 million, including sequential price per-pound increases each quarter, we are optimistic about our sales and margin growth prospects for 2023 and beyond.”

About Universal Stainless & Alloy Products, Inc.

Universal Stainless & Alloy Products, Inc., established in 1994 and headquartered in Bridgeville, PA, manufactures and markets semi-finished and finished specialty steels, including stainless steel, nickel alloys, tool steel and certain other alloyed steels. The Company’s products are used in a variety of industries, including aerospace, power generation, oil and gas, and heavy equipment manufacturing. More information is available at www.univstainless.com.