Schnitzer Steel Industries Inc. said Wednesday it expects to report a loss in its fiscal first quarter as the economic downturn has led to reduced business.
Schnitzer said renegotiations, deferrals and cancellations of customer contracts led to lower sales and prices during the quarter. The company said this will result in a non-cash write down of about $60 million for its metals recycling and steel manufacturing inventories in its quarter ended Nov. 30.
The company said production output has fallen by about 40 percent from average 2008 levels, and said it has instituted cost-control measures including work force reductions.
The announcement comes two months after Schnitzer reported its fourth-quarter profit tripled to $126.4 million on rising business across all three of its segments. At the time, the company indicated business had begun to slow down in the first quarter.
Schnitzer said it expects to issue first-quarter results Jan. 8.
Shares of the company fell 66 cents to $35.30 in premarket activity