Metallus Announces First-Quarter 2026 Results
Rhea-AI Summary
Metallus (NYSE: MTUS) reported Q1 2026 net sales of $308.3 million and net income of $5.4 million ($0.13 diluted). Adjusted EBITDA was $24.6 million, up 39% year‑over‑year. Shipments were 163,800 tons with melt utilization at 72%. Cash was $104.0 million and total liquidity $374.7 million as of March 31, 2026. First‑quarter capex was $24.7 million; company repurchased $4.3 million of shares and has $85.4 million remaining authorization. Full‑year capex remains ~ $70 million with $35 million partially government‑funded.
Positive
- Adjusted EBITDA +39% year‑over‑year to $24.6M
- Shipments 163,800 tons (up 11% sequentially)
- Melt utilization improved to 72% (up 7 points YoY)
- Cash and total liquidity of $104.0M and $374.7M
- Received $91.5M government funding to date
Negative
- Operating cash flow outflow of $26.9M in Q1
- First‑quarter pension contributions concentrated early in year
- Planned 2026 capital expenditures about $70M
News Market Reaction – MTUS
On the day this news was published, MTUS gained 3.54%, reflecting a moderate positive market reaction. Our momentum scanner triggered 5 alerts that day, indicating moderate trading interest and price volatility. This price movement added approximately $28M to the company's valuation, bringing the market cap to $830.44M at that time.
Data tracked by StockTitan Argus on the day of publication.
Key Figures
Market Reality Check
Peers on Argus
MTUS slipped 0.52% while sector peers were mixed: NWPX up 5.55%, ASTL up 2.66%, ZEUS down 6.16%. Momentum scanner names SIM, FRD, and SID were all up without news, suggesting today’s move in MTUS is stock-specific rather than a sector-wide rotation.
Historical Context
| Date | Event | Sentiment | Move | Catalyst |
|---|---|---|---|---|
| Apr 14 | Earnings webcast details | Neutral | -0.1% | Announcement of Q1 2026 release date and webcast logistics. |
| Feb 19 | Q4 & FY 2025 results | Negative | -16.0% | Reported Q4 2025 net loss and modest full-year sales growth. |
| Feb 05 | Labor contract ratified | Positive | +2.6% | USW Local 1123 ratified a four-year collective bargaining agreement. |
| Jan 29 | Earnings webcast details | Neutral | +0.5% | Scheduled Q4 and full-year 2025 earnings release and call. |
| Jan 16 | Tentative labor agreement | Positive | -1.2% | Tentative four-year contract agreement covering 1,200 employees. |
Earnings and contract news have often moved the stock in the same direction as the headline tone, though one labor-related update showed a mild divergence.
Over the last few months, Metallus has focused on labor stability, capex, and improving fundamentals. A four-year USW contract was tentatively agreed on Jan 16, 2026 and ratified on Feb 5, 2026, supporting operational continuity. Q4 and full-year 2025 results showed a $14.3M quarterly net loss and $1.2B in full-year sales, which coincided with a 16.01% decline. Today’s Q1 2026 release highlights a return to profitability and stronger adjusted EBITDA versus that weak Q4 baseline.
Market Pulse Summary
This announcement highlights a notable rebound in performance, with Q1 2026 net sales of $308.3M, net income of $5.4M, and adjusted EBITDA of $24.6M after a Q4 2025 net loss. Shipments grew to 163,800 tons and melt utilization improved to 72%, while cash stood at $104.0M and total liquidity at $374.7M. Investors may track working-capital-driven cash outflows of $26.9M, the planned $70M 2026 capex program, and whether sequential EBITDA gains materialize as management anticipates.
Key Terms
adjusted EBITDA financial
total liquidity financial
operating cash flow financial
capital expenditures financial
pension contributions financial
non-GAAP financial measures financial
adjusted effective income tax rate financial
AI-generated analysis. Not financial advice.
- Net sales of
$308.3 million 10% compared to prior-year first quarter, and net income of$5.4 million - Adjusted EBITDA of
$24.6 million 39% compared to prior-year first quarter - Invested
$24.7 million - Continued year‑over‑year growth in the order book underscores stronger demand
- First blooms successfully reheated and rolled on new bloom reheat furnace
- Cash and cash equivalents of
$104.0 million $374.7
This compares with the sequential fourth-quarter 2025 net sales of
In the same quarter last year, the company had net sales of
"In the first quarter, our teams executed against our operational priorities, delivering improved performance across the business. Our order book continued to grow year-over-year, supported by strengthening demand across all our end markets. We continued to invest in the next stages of operational excellence, resulting in higher melt utilization that improved both sequentially and year over year in the first quarter. In addition, we achieved an important milestone by successfully reheating and rolling the first blooms from our new bloom reheat furnace," said Michael Williams, chief executive officer. "Looking ahead, we continue to expect improved profitability in each quarter of 2026 compared with the prior year period, driven by a strong order book, a favorable product mix, and an improving pricing environment."
FIRST-QUARTER 2026 FINANCIAL SUMMARY
- Net sales increased 15 percent to
$308.3 million $267.3 million - Ship tons increased 15,800 tons sequentially, or 11 percent, to 163,800 tons driven primarily by higher shipments across all end-markets. Compared with the prior-year first quarter, shipments increased 7 percent, driven by higher shipments across all end-markets except energy.
- Manufacturing performance improved sequentially, primarily reflecting improved fixed‑cost leverage associated with higher production volumes and lower costs from not having a significant planned annual maintenance shutdown during the period. Melt utilization improved to 72 percent in the first quarter, up from 66 percent in the fourth quarter and 65 percent in the same quarter last year.
CASH, LIQUIDITY AND REPURCHASE ACTIVITY
As of March 31, 2026, the company's cash and cash equivalents balance was
Additionally, during the first quarter, the company repurchased 0.3 million common shares at an aggregate cost of
During the first quarter, the company received
OUTLOOK
Given the elements outlined in the outlook below, the company expects second-quarter adjusted EBITDA to be modestly higher than the first quarter of 2026 and the second quarter of 2025.
Commercial:
- Second-quarter shipments are expected to increase modestly on a sequential basis, in the low single digits on a percentage basis, supported by continued strength in the order book and normal seasonality.
- Lead times for bar and tube products currently extend into late third quarter.
- Based on lead times and product mix, second quarter price and mix are expected to be similar to the first quarter, with improvement anticipated in the second half of 2026.
- The company recently implemented spot price increases on both bar and seamless mechanical tubing products not covered by an annual pricing agreement. These price increases take effect at various dates throughout the second half of 2026, dependent on product type.
Operations:
- The company anticipates a sequential increase in its second quarter average melt utilization rate, supported by strength in the order book.
- Manufacturing costs are expected to improve sequentially by approximately
$2 million
Other matters:
- Planned capital expenditures remain at approximately
$70 million $35 million U.S. government. In April, the company received$9.5 million $2 million - Required pension contributions were approximately
$5 million $5 million - An adjusted effective income tax rate(3) between 27 and 30 percent is expected for the full year 2026.
(1) | The company defines total liquidity as available borrowing capacity plus cash and cash equivalents. |
(2) | Please see discussion of non-GAAP financial measures in this news release. |
(3) | The company defines the adjusted effective income tax rate as adjusted income tax expense (benefit) divided by adjusted pre-tax (loss) income. |
METALLUS EARNINGS WEBCAST INFORMATION
Metallus will provide live Internet listening access to its conference call with the financial community scheduled for Tuesday, May 5, 2026, at 9:00 a.m. ET. The live conference call will be broadcast at investors.metallus.com. A replay of the conference call will also be available at investors.metallus.com.
ABOUT METALLUS INC.
Metallus (NYSE: MTUS) manufactures high-performance specialty metals from recycled scrap metal in
NON-GAAP FINANCIAL MEASURES
Metallus reports its financial results in accordance with accounting principles generally accepted in
FORWARD-LOOKING STATEMENTS
This news release includes "forward-looking" statements within the meaning of the federal securities laws. You can generally identify the company's forward-looking statements by words such as "will," "anticipate," "aspire," "believe," "could," "estimate," "expect," "forecast," "outlook," "intend," "may," "plan," "possible," "potential," "predict," "project," "seek," "target," "should," "would," "strategy," or "strategic direction" or other similar words, phrases or expressions that convey the uncertainty of future events or outcomes. The company cautions readers that actual results may differ materially from those expressed or implied in forward-looking statements made by or on behalf of the company due to a variety of factors, such as: (1) the effects of fluctuations in customer demand on sales, product mix and prices in the industries in which the company operates, including the ability of the company to respond to rapid changes in customer demand including but not limited to changes in domestic and worldwide political and economic conditions due to, among other factors,
Additional risks relating to the company's business, the industries in which the company operates, or the company's common shares may be described from time to time in the company's filings with the SEC. All of these risk factors are difficult to predict, are subject to material uncertainties that may affect actual results and may be beyond the company's control. Readers are cautioned that it is not possible to predict or identify all of the risks, uncertainties and other factors that may affect future results and that the above list should not be considered to be a complete list. Except as required by the federal securities laws, the company undertakes no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.
CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||||
Three Months Ended March 31, | ||||||||
(in millions, except per share data) (Unaudited) | 2026 | 2025 | ||||||
Net sales | $ | 308.3 | $ | 280.5 | ||||
Cost of products sold | 283.2 | 258.6 | ||||||
Gross Profit | 25.1 | 21.9 | ||||||
Selling, general & administrative expenses (SG&A) | 22.2 | 24.3 | ||||||
Loss (gain) on sale or disposal of assets, net | 0.2 | (1.5) | ||||||
Other (income) expense, net | (4.9) | (2.3) | ||||||
Interest (income) expense, net | (0.4) | (1.5) | ||||||
Income (Loss) Before Income Taxes | 8.0 | 2.9 | ||||||
Provision (benefit) for income taxes | 2.6 | 1.6 | ||||||
Net Income (Loss) | $ | 5.4 | $ | 1.3 | ||||
Net Income (Loss) per Common Share: | ||||||||
Basic earnings (loss) per share | $ | 0.13 | $ | 0.03 | ||||
Diluted earnings (loss) per share(1, 2) | $ | 0.13 | $ | 0.03 | ||||
Weighted average shares outstanding - basic | 41.7 | 42.1 | ||||||
Weighted average shares outstanding - diluted(1, 2) | 43.2 | 43.0 | ||||||
(1) For the three months ended March 31, 2026, common share equivalents for shares issuable for equity-based awards (1.5 million shares) were included in the computation of diluted earnings (loss) per share, as they were considered dilutive. |
(2) For the three months ended March 31, 2025, common share equivalents for shares issuable for equity-based awards (0.9 million shares) were included in the computation of diluted earnings (loss) per share, as they were considered dilutive. Common share equivalents for shares issuable upon the conversion of outstanding convertible notes were excluded in the computation of diluted earnings (loss) per share for the three months ended March 31, 2025 as these shares would be anti-dilutive. |
CONSOLIDATED BALANCE SHEETS | ||||||||
(Dollars in millions) (Unaudited) | March 31, | December 31, | ||||||
ASSETS | ||||||||
Cash and cash equivalents | $ | 104.0 | $ | 156.7 | ||||
Accounts receivable, net of allowances | 147.4 | 126.0 | ||||||
Inventories, net | 279.6 | 243.2 | ||||||
Deferred charges and prepaid expenses | 19.8 | 26.4 | ||||||
Other current assets | 1.3 | 0.9 | ||||||
Total Current Assets | 552.1 | 553.2 | ||||||
Property, plant and equipment, net | 561.3 | 562.5 | ||||||
Operating lease right-of-use assets | 10.1 | 11.4 | ||||||
Finance lease right-of-use assets | 3.5 | 3.5 | ||||||
Pension assets | 7.3 | 5.6 | ||||||
Intangible assets, net | 2.8 | 2.9 | ||||||
Other non-current assets | 1.1 | 1.1 | ||||||
Total Assets | $ | 1,138.2 | $ | 1,140.2 | ||||
LIABILITIES | ||||||||
Accounts payable | $ | 175.3 | $ | 151.1 | ||||
Salaries, wages and benefits | 19.2 | 29.0 | ||||||
Accrued pension and postretirement costs | 12.1 | 26.8 | ||||||
Current operating lease liabilities | 3.7 | 4.0 | ||||||
Current finance lease liabilities | 0.8 | 0.8 | ||||||
Government funding liabilities | 91.5 | 85.6 | ||||||
Other current liabilities | 16.4 | 17.6 | ||||||
Total Current Liabilities | 319.0 | 314.9 | ||||||
Credit agreement | — | — | ||||||
Non-current operating lease liabilities | 6.7 | 7.3 | ||||||
Non-current finance lease liabilities | 2.0 | 2.8 | ||||||
Accrued pension and postretirement costs | 98.9 | 100.2 | ||||||
Deferred income taxes | 16.9 | 16.9 | ||||||
Other non-current liabilities | 11.7 | 12.1 | ||||||
Total Liabilities | 455.2 | 454.2 | ||||||
SHAREHOLDERS' EQUITY | ||||||||
Additional paid-in capital | 846.2 | 850.2 | ||||||
Retained deficit | (48.2) | (53.6) | ||||||
Treasury shares | (115.7) | (116.0) | ||||||
Accumulated other comprehensive income (loss) | 0.7 | 5.4 | ||||||
Total Shareholders' Equity | 683.0 | 686.0 | ||||||
Total Liabilities and Shareholders' Equity | $ | 1,138.2 | $ | 1,140.2 | ||||
CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||||||
(Dollars in millions) (Unaudited) | Three Months Ended March 31, | |||||||
2026 | 2025 | |||||||
CASH PROVIDED (USED) | ||||||||
Operating Activities | ||||||||
Net income (loss) | $ | 5.4 | $ | 1.3 | ||||
Adjustments to reconcile net income (loss) to net cash provided (used) by operating activities: | ||||||||
Depreciation and amortization | 13.7 | 13.7 | ||||||
Amortization of deferred financing fees | 0.1 | 0.1 | ||||||
Loss (gain) on sale or disposal of assets, net | 0.2 | (1.5) | ||||||
Stock-based compensation expense | 3.3 | 3.4 | ||||||
Pension and postretirement expense (benefit), net | (2.3) | 0.8 | ||||||
Changes in operating assets and liabilities: | ||||||||
Accounts receivable, net | (21.4) | (34.8) | ||||||
Inventories, net | (36.4) | (10.8) | ||||||
Accounts payable | 36.3 | 34.0 | ||||||
Other accrued expenses | (11.4) | 2.9 | ||||||
Deferred charges and prepaid expenses | 6.6 | 2.5 | ||||||
Pension and postretirement contributions and payments | (19.8) | (53.0) | ||||||
Other, net | (1.2) | 2.5 | ||||||
Net Cash Provided (Used) by Operating Activities | (26.9) | (38.9) | ||||||
Investing Activities | ||||||||
Capital expenditures | (24.7) | (27.5) | ||||||
Proceeds from government funding | 5.9 | 12.9 | ||||||
Proceeds from disposals of property, plant and equipment | — | 1.7 | ||||||
Net Cash Provided (Used) by Investing Activities | (18.8) | (12.9) | ||||||
Financing Activities | ||||||||
Purchase of treasury shares | (4.3) | (5.6) | ||||||
Proceeds from exercise of stock options | 0.3 | — | ||||||
Shares surrendered for employee taxes on stock compensation | (3.0) | (2.6) | ||||||
Principal payments under finance lease obligations | — | — | ||||||
Net Cash Provided (Used) by Financing Activities | (7.0) | (8.2) | ||||||
Increase (Decrease) in Cash, Cash Equivalents, and Restricted Cash | (52.7) | (60.0) | ||||||
Cash, cash equivalents, and restricted cash at beginning of period | 157.5 | 241.9 | ||||||
Cash, Cash Equivalents, and Restricted Cash at End of Period | $ | 104.8 | $ | 181.9 | ||||
The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported within the Consolidated Balance | ||||||||
Cash and cash equivalents | $ | 104.0 | $ | 180.3 | ||||
Restricted cash reported in other current assets | 0.8 | 1.6 | ||||||
Total cash, cash equivalents, and restricted cash shown in the Consolidated Statements of Cash Flows | $ | 104.8 | $ | 181.9 | ||||
Reconciliation of Free Cash Flow to GAAP Net Cash Provided (Used) by Operating Activities:
This reconciliation is provided as additional relevant information about the company's financial position. Free cash flow is an important financial measure used in the management of the business. Management believes that free cash flow is useful to investors because it is a meaningful indicator of cash generated from operating activities available for the execution of its business strategy.
Three Months Ended | ||||||||
(Dollars in millions) (Unaudited) | 2026 | 2025 | ||||||
Net Cash Provided (Used) by Operating Activities | $ | (26.9) | $ | (38.9) | ||||
Less: Capital expenditures less government-funded capital expenditures(1) | (6.4) | (13.6) | ||||||
Less: MTUS portion of government-funded capital expenditures | (12.4) | — | ||||||
Free Cash Flow | $ | (45.7) | $ | (52.5) | ||||
(1) On February 27, 2024, the company entered into an agreement for up to |
Reconciliation of Capital expenditures less government-funded capital expenditures to GAAP Capital expenditures:
This reconciliation is provided as additional relevant information about the company's capital expenditures. Capital expenditures less government-funded capital expenditures is an important financial measure used in the management of the business. Management believes that capital expenditures less government-funded capital expenditures is useful to investors because it is a meaningful indicator of capital expenditures associated with the ordinary course of the company's business.
Three Months Ended | ||||||||
(Dollars in millions) (Unaudited) | 2026 | 2025 | ||||||
Capital expenditures | $ | (24.7) | $ | (27.5) | ||||
Less: Government-funded capital expenditures | (18.3) | (13.9) | ||||||
Capital expenditures less government-funded capital expenditures | $ | (6.4) | $ | (13.6) | ||||
Reconciliation of adjusted net income (loss)(2) to GAAP net income (loss) and adjusted diluted earnings (loss) per share(2) to GAAP diluted earnings (loss) per share for the three months ended March 31, 2026, March 31, 2025, and December 31, 2025:
Adjusted net income (loss) and adjusted diluted earnings (loss) per share are financial measures not required by or presented in accordance with GAAP. These Non-GAAP financial measures should be considered as a supplement to, and not as a substitute for, the financial measures prepared in accordance with GAAP, and a reconciliation of these financial measures to the most comparable GAAP financial measures is presented. Management believes this data provides investors with additional useful information on the underlying operations and trends of the business and enables period-to-period comparability of the company's financial performance.
Three Months Ended | Three Months Ended | Three Months Ended | ||||||||||||||||||||||
(Dollars in millions) (Unaudited) | Net | Diluted | Net | Diluted | Net | Diluted | ||||||||||||||||||
As reported | $ | 5.4 | $ | 0.13 | $ | 1.3 | $ | 0.03 | $ | (14.3) | $ | (0.34) | ||||||||||||
Adjustments:(2) | ||||||||||||||||||||||||
Loss (gain) on sale or disposal of assets, net | 0.2 | — | (1.5) | (0.03) | — | — | ||||||||||||||||||
Loss (gain) from remeasurement of benefit | (2.5) | (0.06) | — | — | 6.6 | 0.16 | ||||||||||||||||||
Sales and use tax refund | — | — | (0.8) | (0.02) | — | — | ||||||||||||||||||
Business transformation costs(3) | 0.6 | 0.02 | — | — | — | — | ||||||||||||||||||
IT transformation costs(4) | 0.2 | — | 0.9 | 0.02 | 0.5 | 0.01 | ||||||||||||||||||
Manufacturing optimization costs(5) | 2.3 | 0.06 | — | — | 1.7 | 0.04 | ||||||||||||||||||
Rebranding costs(6) | — | — | 0.1 | — | — | — | ||||||||||||||||||
Salaried pension plan surplus asset | — | — | 3.6 | 0.08 | — | — | ||||||||||||||||||
USW one-time contract negotiation(8) | 2.2 | 0.05 | — | — | — | — | ||||||||||||||||||
Tax effect on above adjustments(9) | (0.7) | (0.02) | (0.7) | (0.01) | (2.2) | (0.05) | ||||||||||||||||||
As adjusted(10) | $ | 7.7 | $ | 0.18 | $ | 2.9 | $ | 0.07 | $ | (7.7) | $ | (0.18) | ||||||||||||
(1) For the three months ended March 31, 2026, common share equivalents for shares issuable for equity-based awards (1.5 million shares) were included in the computation of diluted earnings (loss) per share, as they were considered dilutive. The total diluted weighted average shares outstanding for the three months ended March 31, 2026 was 43.2 million shares. |
(2) Adjusted net income (loss) and adjusted diluted earnings (loss) per share are defined as net income (loss) and diluted earnings (loss) per share, respectively, excluding, as applicable, adjustments listed in the foregoing table. |
(3) Business transformation costs consist of professional service fees associated with the evaluation of certain strategic opportunities, with a focus on targeted growth to diversify the company's end market and product portfolio through acquisitions. |
(4) The company is undergoing a multi-year IT transformation initiative intended to streamline and modernize legacy IT systems while also reducing operating costs, increasing information security and positioning us to take advantage of market opportunities. IT transformation costs were primarily related to professional service fees not eligible for capitalization and are primarily related to project planning and third-party implementation services. |
(5) Manufacturing optimization costs consist of third-party professional fees related to process optimization efforts and improving manufacturing efficiency within targeted facilities. |
(6) Rebranding costs consist primarily of professional service fees associated with the company's name change to Metallus Inc., announced during the first quarter of 2024. |
(7) Following the completion of the salaried pension plan annuitization in May 2024, there were surplus assets which were used to make a one-time 401(k) contribution to eligible employees. As a result, the Company recognized a loss of |
(8) The United Steelworkers ("USW") ratified a new four‑year labor agreement with Metallus on February 5, 2026. A one‑time payment in the total amount of |
(9) Tax effect on above adjustments includes the tax impact related to the adjustments shown above. Refer to the adjusted effective tax rate reconciliation table. |
(10) Adjusted net income (loss), adjusted diluted earnings (loss) per share, and the related tax effect has been revised to include amortization of cloud computing software costs. |
(11) For the three months ended March 31, 2025, common share equivalents for shares issuable for equity-based awards (0.9 million shares) were included in the computation of diluted earnings (loss) per share, as they were considered dilutive. Common share equivalents for shares issuable upon the conversion of outstanding convertible notes were excluded in the computation of diluted earnings (loss) per share for the three months ended March 31, 2025 as these shares would be anti-dilutive. The total diluted weighted average shares outstanding for the three months ended March 31, 2025 was 43.0 million shares. |
(12) For the three months ended December 31, 2025, common share equivalents for shares issuable for equity-based awards and common share equivalents for shares issuable upon the conversion of outstanding convertible notes were excluded from the computation of diluted earnings (loss) per share, because the effect of their inclusion would have been anti-dilutive. The total diluted weighted average shares outstanding for the three months ended December 31, 2025 was 41.7 million shares. |
Reconciliation of adjusted effective tax rate to GAAP effective tax rate for the three months ended March 31, 2026, March 31, 2025, and December 31, 2025:
This reconciliation is provided as additional relevant information between the company's GAAP effective tax rate and the adjusted effective tax rate. These Non-GAAP financial measures should be considered as a supplement to, and not as a substitute for, the financial measures prepared in accordance with GAAP, and a reconciliation of these financial measures to the most comparable GAAP financial measures is presented. Management believes this data provides investors with additional useful information on the underlying operations and trends of the business and enables period-to-period comparability of the company's financial performance.
Three months ended | Three months ended | Three months ended | ||||||||||||||||||||||||||||||||||
(Dollars in millions) | Pre-tax | Income | Effective | Pre-tax | Income | Effective | Pre-tax | Income | Effective | |||||||||||||||||||||||||||
As reported | $ | 8.0 | $ | 2.6 | 32.5 | % | $ | 2.9 | $ | 1.6 | 55.3 | % | $ | (20.5) | $ | (6.2) | 30.2 | % | ||||||||||||||||||
Non-GAAP Adjustments | 3.0 | 0.7 | 2.3 | 0.7 | 8.8 | 2.2 | ||||||||||||||||||||||||||||||
As adjusted(1) | $ | 11.0 | $ | 3.3 | 30.0 | % | $ | 5.2 | $ | 2.3 | 44.2 | % | $ | (11.7) | $ | (4.0) | 34.2 | % | ||||||||||||||||||
(1) Refer to adjusted net income and earnings per share reconciliation for details. |
Reconciliation of Earnings (Loss) Before Interest, Taxes, Depreciation and Amortization (EBITDA)(3) and Adjusted EBITDA(10) to GAAP Net Income (Loss):
This reconciliation is provided as additional relevant information about the company's performance. EBITDA and Adjusted EBITDA are important financial measures used in the management of the business, including decisions concerning the allocation of resources and assessment of performance. Management believes that reporting EBITDA and Adjusted EBITDA is useful to investors as these measures are representative of the company's performance. Management also believes that it is appropriate to compare GAAP net income (loss) to EBITDA and Adjusted EBITDA.
Three Months | Three Months | |||||||||||
(Dollars in millions) (Unaudited) | 2026 | 2025 | 2025 | |||||||||
Net income (loss) | $ | 5.4 | $ | 1.3 | $ | (14.3) | ||||||
Net Income Margin (1) | 1.8 | % | 0.5 | % | (5.3) | % | ||||||
Provision (benefit) for income taxes | 2.6 | 1.6 | (6.2) | |||||||||
Interest (income) expense, net | (0.4) | (1.5) | (0.7) | |||||||||
Depreciation and amortization | 13.7 | 13.7 | 14.5 | |||||||||
Amortization of cloud-computing costs (2) | 0.3 | 0.3 | 0.3 | |||||||||
Earnings Before Interest, Taxes, Depreciation and | $ | 21.6 | $ | 15.4 | $ | (6.4) | ||||||
EBITDA Margin (3) | 7.0 | % | 5.5 | % | (2.4) | % | ||||||
Adjustments: | ||||||||||||
(Gain) loss from remeasurement of benefit plans | (2.5) | — | 6.6 | |||||||||
Sales and use tax refund | — | (0.8) | — | |||||||||
Business transformation costs (4) | 0.6 | — | — | |||||||||
IT transformation costs (5) | 0.2 | 0.9 | 0.5 | |||||||||
Manufacturing optimization costs (6) | 2.3 | — | 1.7 | |||||||||
Rebranding costs (7) | — | 0.1 | — | |||||||||
Salaried pension plan surplus asset distribution (8) | — | 3.6 | — | |||||||||
USW one-time contract negotiation (9) | 2.2 | — | — | |||||||||
(Gain) loss on sale or disposal of assets, net | 0.2 | (1.5) | — | |||||||||
Adjusted EBITDA (10) | $ | 24.6 | $ | 17.7 | $ | 2.4 | ||||||
Adjusted EBITDA Margin (10) | 8.0 | % | 6.3 | % | 0.9 | % | ||||||
(1) Net Income Margin is defined as net income (loss) as a percentage of net sales. |
(2) Amortization of cloud computing software costs consists of expense recognized in Selling, General, and Administrative expense resulting from amortization of capitalized implementation costs for cloud computing IT systems. This expense is not included in depreciation and amortization. |
(3) EBITDA is defined as net income (loss) before interest (income) expense, net, income taxes, depreciation and amortization, including cloud-computing costs. EBITDA Margin is EBITDA as a percentage of net sales. |
(4) Business transformation costs consist of professional service fees associated with the evaluation of certain strategic opportunities, with a focus on targeted growth to diversify the company's end market and product portfolio through acquisitions. |
(5) The company is undergoing a multi-year IT transformation initiative intended to streamline and modernize legacy IT systems while also reducing operating costs, increasing information security and positioning us to take advantage of market opportunities. IT transformation costs were primarily related to professional service fees not eligible for capitalization and are primarily related to project planning and third-party implementation services. |
(6) Manufacturing optimization costs consist of third-party professional fees related to process optimization efforts and improving manufacturing efficiency within targeted facilities. |
(7) Rebranding costs consist primarily of professional service fees associated with the company's name change to Metallus Inc., announced during the first quarter of 2024. |
(8) Following the completion of the salaried pension plan annuitization in May 2024, there were surplus assets which were used to make a one-time 401(k) contribution to eligible employees. As a result, the company recognized a loss of |
(9) The United Steelworkers ("USW") ratified a new four‑year labor agreement with Metallus on February 5, 2026. A one‑time payment in the total amount of |
(10) Adjusted EBITDA is defined as EBITDA excluding, as applicable, adjustments listed in the table above. Adjusted EBITDA Margin is Adjusted EBITDA as a percentage of net sales. |
Reconciliation of Base Sales by end-market to GAAP Net Sales by end-market:
The tables below present net sales by end-market, adjusted to exclude surcharges, which represents a financial measure that has not been determined in accordance with GAAP. Management believes presenting net sales by end-market, both on a gross basis and on a per ton basis, adjusted to exclude raw material and energy surcharges, provides additional insight into key drivers of net sales such as base price and product mix. Due to the fact that the surcharge mechanism can introduce volatility to our net sales, net sales adjusted to exclude surcharges provides management and investors clarity of our core pricing and results. Presenting net sales by end-market, adjusted to exclude surcharges including on a per ton basis, allows management and investors to better analyze key market indicators and trends and allows for enhanced comparison between our end-markets.
When surcharges are included in a customer agreement and are applicable (i.e., reach the threshold amount), based on the terms outlined in the respective agreement, surcharges are then included as separate line items on a customer's invoice. These additional surcharge line items adjust base prices to match cost fluctuations due to market conditions. Each month, the company will post on the surcharges page of its external website, as well as our customer portal, the scrap, alloy, and energy surcharges that will be applied (as a separate line item) to invoices dated in the following month (based upon shipment volumes in the following month). All surcharges invoiced are included in GAAP net sales.
(Dollars in millions, ship tons in thousands) | ||||||||||||||||||||||||
Three Months Ended March 31, 2026 | ||||||||||||||||||||||||
Industrial | Automotive | Aerospace & | Energy | Other | Total | |||||||||||||||||||
Ship Tons | 67.1 | 66.6 | 17.7 | 12.4 | — | 163.8 | ||||||||||||||||||
Net Sales | $ | 112.3 | $ | 112.7 | $ | 51.9 | $ | 26.7 | $ | 4.7 | $ | 308.3 | ||||||||||||
Less: Surcharges | 31.4 | 23.2 | 8.4 | 7.0 | — | 70.0 | ||||||||||||||||||
Base Sales | $ | 80.9 | $ | 89.5 | $ | 43.5 | $ | 19.7 | $ | 4.7 | $ | 238.3 | ||||||||||||
Net Sales / Ton | $ | 1,674 | $ | 1,692 | $ | 2,932 | $ | 2,153 | $ | — | $ | 1,882 | ||||||||||||
Surcharges / Ton | $ | 468 | $ | 348 | $ | 475 | $ | 565 | $ | — | $ | 427 | ||||||||||||
Base Sales / Ton | $ | 1,206 | $ | 1,344 | $ | 2,457 | $ | 1,588 | $ | — | $ | 1,455 | ||||||||||||
Three Months Ended March 31, 2025 | ||||||||||||||||||||||||
Industrial | Automotive | Aerospace & | Energy | Other | Total | |||||||||||||||||||
Ship Tons | 66.3 | 64.1 | 8.6 | 13.9 | — | 152.9 | ||||||||||||||||||
Net Sales | $ | 101.7 | $ | 113.2 | $ | 32.5 | $ | 28.7 | $ | 4.4 | $ | 280.5 | ||||||||||||
Less: Surcharges | 26.6 | 21.6 | 3.4 | 6.7 | — | 58.3 | ||||||||||||||||||
Base Sales | $ | 75.1 | $ | 91.6 | $ | 29.1 | $ | 22.0 | $ | 4.4 | $ | 222.2 | ||||||||||||
Net Sales / Ton | $ | 1,534 | $ | 1,766 | $ | 3,779 | $ | 2,065 | $ | — | $ | 1,835 | ||||||||||||
Surcharges / Ton | $ | 401 | $ | 337 | $ | 395 | $ | 482 | $ | — | $ | 381 | ||||||||||||
Base Sales / Ton | $ | 1,133 | $ | 1,429 | $ | 3,384 | $ | 1,583 | $ | — | $ | 1,454 | ||||||||||||
Three Months Ended December 31, 2025 | ||||||||||||||||||||||||
Industrial | Automotive | Aerospace & | Energy | Other | Total | |||||||||||||||||||
Ship Tons | 59.9 | 64.2 | 15.6 | 8.3 | — | 148.0 | ||||||||||||||||||
Net Sales | $ | 95.3 | $ | 110.4 | $ | 39.6 | $ | 18.3 | $ | 3.7 | $ | 267.3 | ||||||||||||
Less: Surcharges | 24.1 | 20.8 | 5.3 | 4.4 | — | 54.6 | ||||||||||||||||||
Base Sales | $ | 71.2 | $ | 89.6 | $ | 34.3 | $ | 13.9 | $ | 3.7 | $ | 212.7 | ||||||||||||
Net Sales / Ton | $ | 1,591 | $ | 1,720 | $ | 2,538 | $ | 2,205 | $ | — | $ | 1,806 | ||||||||||||
Surcharges / Ton | $ | 402 | $ | 324 | $ | 340 | $ | 530 | $ | — | $ | 369 | ||||||||||||
Base Sales / Ton | $ | 1,189 | $ | 1,396 | $ | 2,198 | $ | 1,675 | $ | — | $ | 1,437 | ||||||||||||
Calculation of Total Liquidity(1):
This calculation is provided as additional relevant information about the company's financial position.
(Dollars in millions) (Unaudited) | March 31, | December 31, | ||||||
Cash and cash equivalents | $ | 104.0 | $ | 156.7 | ||||
Credit Agreement: | ||||||||
Maximum availability | $ | 400.0 | $ | 400.0 | ||||
Suppressed availability(2) | (124.0) | (162.2) | ||||||
Availability | 276.0 | 237.8 | ||||||
Credit facility amount borrowed | — | — | ||||||
Letter of credit obligations | (5.3) | (5.3) | ||||||
Availability not borrowed | $ | 270.7 | $ | 232.5 | ||||
Total Liquidity(1) | $ | 374.7 | $ | 389.2 | ||||
(1) Total Liquidity is defined as available borrowing capacity plus cash and cash equivalents. |
(2) As of March 31, 2026 and December 31, 2025, Metallus had less than |
ADJUSTED EBITDA(1) WALKS | ||||||||
(Dollars in millions) (Unaudited) | 2025 1Q | 2025 4Q | ||||||
Beginning Adjusted EBITDA(1) | $ | 17.7 | $ | 2.4 | ||||
Volume | 4.5 | 7.2 | ||||||
Price/Mix | 4.8 | 4.3 | ||||||
Raw Material Spread | 1.0 | 2.7 | ||||||
Manufacturing | (3.9) | 8.5 | ||||||
SG&A | 0.7 | 0.5 | ||||||
Other | (0.2) | (1.0) | ||||||
Ending Adjusted EBITDA(1) | $ | 24.6 | $ | 24.6 | ||||
(1) Please refer to the Reconciliation of Earnings (Loss) Before Interest, Taxes, Depreciation and Amortization (EBITDA) and Adjusted EBITDA to GAAP Net Income (Loss). |
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SOURCE Metallus Inc.