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Radius Recycling(RDUS) - 2025 Q3 - Quarterly Report
2025-07-01 18:33
[FORWARD-LOOKING STATEMENTS](index=3&type=section&id=FORWARD-LOOKING%20STATEMENTS) This section outlines statements regarding future events, expectations, and strategies, including the proposed merger, and identifies associated risks and uncertainties - Forward-looking statements cover future events, expectations, intentions, beliefs, and strategies, including the proposed merger with **Toyota Tsusho America, Inc. (TAI)**[9](index=9&type=chunk) - Risks and uncertainties that could cause actual results to differ materially include **merger-related risks**, **equipment issues**, **economic conditions**, **supply chain disruptions**, and **environmental liabilities**[11](index=11&type=chunk)[12](index=12&type=chunk) [PART I. FINANCIAL INFORMATION](index=6&type=section&id=PART%20I.%2E%20FINANCIAL%20INFORMATION) This part presents the company's unaudited condensed consolidated financial statements and related notes for the reporting period [Item 1. Financial Statements (Unaudited)](index=6&type=section&id=Item%201.%20Financial%20Statements%20%28Unaudited%29) This section provides the unaudited condensed consolidated financial statements, including balance sheets, statements of operations, comprehensive income (loss), equity, and cash flows, along with detailed notes explaining significant accounting policies and specific financial items [Unaudited Condensed Consolidated Balance Sheets](index=6&type=section&id=Unaudited%20Condensed%20Consolidated%20Balance%20Sheets) This section presents the company's financial position, detailing assets, liabilities, and equity at specific points in time Condensed Consolidated Balance Sheets (in thousands) | Metric | May 31, 2025 | August 31, 2024 | Change | | :-------------------------------- | :----------- | :-------------- | :----- | | Total Assets | $1,472,198 | $1,533,769 | (4.0%) | | Total Liabilities | $944,085 | $908,029 | 4.0% | | Total Equity | $528,113 | $625,740 | (15.6%) | | Cash and cash equivalents | $16,214 | $5,552 | 192.0% | | Accounts receivable, net | $239,095 | $258,157 | (7.4%) | | Inventories | $272,957 | $293,932 | (7.2%) | | Long-term debt, net of current maturities | $449,010 | $409,082 | 9.8% | | Retained earnings | $502,913 | $606,417 | (17.1%) | [Unaudited Condensed Consolidated Statements of Operations](index=7&type=section&id=Unaudited%20Condensed%20Consolidated%20Statements%20of%20Operations) This section reports the company's revenues, expenses, and net income or loss over specific periods Condensed Consolidated Statements of Operations (in thousands, except per share) | Metric | 3 Months Ended May 31, 2025 | 3 Months Ended May 31, 2024 | 9 Months Ended May 31, 2025 | 9 Months Ended May 31, 2024 | | :------------------------------------------ | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | | Revenues | $726,991 | $673,920 | $2,026,036 | $1,967,876 | | Cost of goods sold | $677,444 | $628,390 | $1,915,587 | $1,842,806 | | Selling, general and administrative | $56,350 | $62,100 | $167,977 | $187,362 | | Goodwill impairment charges | $— | $215,941 | $— | $215,941 | | Operating income (loss) | $(7,203) | $(235,486) | $(60,795) | $(285,191) | | Net income (loss) attributable to Radius shareholders | $(16,964) | $(198,390) | $(87,114) | $(250,333) | | Basic EPS | $(0.59) | $(6.97) | $(3.04) | $(8.82) | [Unaudited Condensed Consolidated Statements of Comprehensive Income (Loss)](index=8&type=section&id=Unaudited%20Condensed%20Consolidated%20Statements%20of%20Comprehensive%20Income%20%28Loss%29) This section details the company's comprehensive income or loss, including net income and other comprehensive income items Condensed Consolidated Statements of Comprehensive Income (Loss) (in thousands) | Metric | 3 Months Ended May 31, 2025 | 3 Months Ended May 31, 2024 | 9 Months Ended May 31, 2025 | 9 Months Ended May 31, 2024 | | :-------------------------------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | | Net income (loss) | $(16,406) | $(198,511) | $(86,300) | $(250,320) | | Foreign currency translation adjustments | $3,013 | $(308) | $(942) | $(890) | | Total other comprehensive income (loss), net of tax | $3,100 | $616 | $(259) | $615 | | Comprehensive income (loss) attributable to Radius shareholders | $(13,864) | $(197,774) | $(87,373) | $(249,718) | [Unaudited Condensed Consolidated Statements of Equity](index=9&type=section&id=Unaudited%20Condensed%20Consolidated%20Statements%20of%20Equity) This section outlines changes in the company's equity accounts, including retained earnings and total shareholders' equity Condensed Consolidated Statements of Equity (in thousands) | Metric | Balance as of March 1, 2025 | Balance as of May 31, 2025 | Balance as of September 1, 2024 | Balance as of May 31, 2025 | | :------------------------------------ | :-------------------------- | :------------------------- | :-------------------------- | :------------------------- | | Retained Earnings (3 months) | $525,365 | $502,913 | N/A | N/A | | Retained Earnings (9 months) | N/A | N/A | $606,417 | $502,913 | | Total Radius Shareholders' Equity (3 months) | $542,716 | $525,609 | N/A | N/A | | Total Radius Shareholders' Equity (9 months) | N/A | N/A | $623,112 | $525,609 | | Net income (loss) attributable to Radius shareholders (3 months) | N/A | $(16,964) | N/A | N/A | | Net income (loss) attributable to Radius shareholders (9 months) | N/A | N/A | N/A | $(87,114) | | Dividends paid (3 months) | N/A | $(5,488) | N/A | N/A | | Dividends paid (9 months) | N/A | N/A | N/A | $(16,390) | [Unaudited Condensed Consolidated Statements of Cash Flows](index=11&type=section&id=Unaudited%20Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) This section reports the company's cash inflows and outflows from operating, investing, and financing activities Condensed Consolidated Statements of Cash Flows (in thousands) | Metric | 9 Months Ended May 31, 2025 | 9 Months Ended May 31, 2024 | | :------------------------------------------ | :-------------------------- | :-------------------------- | | Net cash provided by (used in) operating activities | $21,229 | $(57,218) | | Net cash used in investing activities | $(29,072) | $(59,429) | | Net cash provided by (used in) financing activities | $18,482 | $135,760 | | Net change in cash and cash equivalents | $10,662 | $19,157 | | Cash and cash equivalents as of end of period | $16,214 | $25,189 | [Notes to the Unaudited Condensed Consolidated Financial Statements](index=13&type=section&id=Notes%20to%20the%20Unaudited%20Condensed%20Consolidated%20Financial%20Statements) This section provides detailed explanations of the company's significant accounting policies and specific financial statement items [Note 1 - Summary of Significant Accounting Policies](index=14&type=section&id=Note%201%20-%20Summary%20of%20Significant%20Accounting%20Policies) This note describes the company's primary business operations, the proposed merger with TAI, and key accounting principles applied - The Company operates as a **single operating and reportable segment**, focusing on **acquiring and recycling scrap metal and producing finished steel products**[38](index=38&type=chunk)[39](index=39&type=chunk) - On March 13, 2025, the Company entered into a **Merger Agreement** with **Toyota Tsusho America, Inc. (TAI)**, under which **Radius Recycling** will become a **wholly-owned subsidiary of TAI**[40](index=40&type=chunk) - Receivables from insurers for environmental claims totaled **$14 million** as of May 31, 2025, and **$13 million** as of August 31, 2024[48](index=48&type=chunk) [Note 2 - Inventories](index=19&type=section&id=Note%202%20-%20Inventories) This note details the composition and valuation of the company's inventory, including scrap metal, semi-finished, and finished goods Inventories (in thousands) | Category | May 31, 2025 | August 31, 2024 | | :-------------------------- | :----------- | :-------------- | | Processed and unprocessed scrap metal | $123,073 | $137,013 | | Semi-finished goods | $12,111 | $14,846 | | Finished goods | $63,713 | $72,225 | | Supplies | $74,060 | $69,848 | | **Total Inventories** | **$272,957** | **$293,932** | [Note 3 - Goodwill](index=19&type=section&id=Note%203%20-%20Goodwill) This note provides information on the company's goodwill balance and any impairment charges recognized during the period - Goodwill balance remained **$13 million** as of May 31, 2025, all allocated to **one recycling services operation**[62](index=62&type=chunk)[65](index=65&type=chunk) - A goodwill impairment charge of **$216 million** was recognized in the **third quarter of fiscal 2024** for **three reporting units** (two regional metals recycling operations and the auto parts stores network)[57](index=57&type=chunk)[63](index=63&type=chunk)[64](index=64&type=chunk) [Note 4 - Commitments and Contingencies](index=21&type=section&id=Note%204%20-%20Commitments%20and%20Contingencies) This note outlines the company's environmental liabilities, legal proceedings, and other significant commitments Environmental Liabilities (in thousands) | Metric | September 1, 2024 | May 31, 2025 | | :-------------------------- | :---------------- | :----------- | | Balance of Liabilities | $65,649 | $64,593 | | Short-Term Liabilities | N/A | $12,993 | | Long-Term Liabilities | N/A | $51,600 | - The Company has environmental liabilities of **$65 million** as of May 31, 2025, primarily for potential remediation at locations where it has conducted business, including **$5 million** related to the **Portland Harbor Superfund site**[68](index=68&type=chunk)[79](index=79&type=chunk) - An indictment against the Company and two employees for environmental regulatory violations related to an August 2023 scrap metal fire was **dismissed on May 23, 2025**[95](index=95&type=chunk) [Note 5 - Accumulated Other Comprehensive Income (Loss)](index=27&type=section&id=Note%205%20-%20Accumulated%20Other%20Comprehensive%20Income%20%28Loss%29) This note details the changes in the company's accumulated other comprehensive income or loss during the reporting periods Changes in Accumulated Other Comprehensive Income (Loss) (in thousands) | Metric | 3 Months Ended May 31, 2025 | 3 Months Ended May 31, 2024 | 9 Months Ended May 31, 2025 | 9 Months Ended May 31, 2024 | | :-------------------------------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | | Balances - March 1 (Beginning of period) | $(43,531) | $(39,684) | N/A | N/A | | Balances - September 1 (Beginning of period) | N/A | N/A | $(40,172) | $(39,683) | | Net periodic other comprehensive income (loss) | $3,100 | $616 | $(259) | $615 | | Balances - May 31 (End of period) | $(40,431) | $(39,068) | $(40,431) | $(39,068) | [Note 6 - Revenue](index=28&type=section&id=Note%206%20-%20Revenue) This note disaggregates the company's revenues by major product categories and sales destinations, highlighting period-over-period changes Revenues by Major Product and Sales Destination (in thousands) | Category | 3 Months Ended May 31, 2025 | 3 Months Ended May 31, 2024 | 9 Months Ended May 31, 2025 | 9 Months Ended May 31, 2024 | | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | | Ferrous revenues | $320,746 | $334,425 | $966,805 | $999,419 | | Nonferrous revenues | $229,428 | $184,127 | $590,489 | $517,902 | | Steel revenues | $125,935 | $108,259 | $331,900 | $322,511 | | Retail and other revenues | $50,882 | $47,109 | $136,842 | $128,044 | | **Total revenues** | **$726,991** | **$673,920** | **$2,026,036** | **$1,967,876** | | Foreign sales | $340,718 | $348,503 | $1,032,275 | $1,023,799 | | Domestic sales | $386,273 | $325,417 | $993,761 | $944,077 | - Total revenues increased **8%** for the three months and **3%** for the nine months ended May 31, 2025, compared to prior year periods[100](index=100&type=chunk) [Note 7 - Share-Based Compensation](index=28&type=section&id=Note%207%20-%20Share-Based%20Compensation) This note describes the company's share-based compensation plans, including RSU, PSU, and DSU grants to employees and directors - In Q1 fiscal 2025, the Company granted **446,993 RSUs** and **340,454 PSUs** to key employees and officers under the **2024 Omnibus Incentive Plan**[103](index=103&type=chunk) - PSUs are based on **relative Total Shareholder Return (TSR)** and **volume growth metrics** over an approximately **three-year performance period**[106](index=106&type=chunk)[108](index=108&type=chunk) - In Q2 fiscal 2025, **57,642 DSUs** were granted to **non-employee directors**, vesting on the day before the **2025 annual meeting**[111](index=111&type=chunk) [Note 8 - Derivative Financial Instruments](index=29&type=section&id=Note%208%20-%20Derivative%20Financial%20Instruments) This note explains the company's use of derivative financial instruments, specifically interest rate swaps, to manage interest rate risk - The Company uses **pay-fixed interest rate swap contracts**, designated as **cash flow hedges**, to manage variability in interest cash flows on variable-rate loans[113](index=113&type=chunk) - The total notional amount of interest rate swaps was **$150 million** as of May 31, 2025, and August 31, 2024[116](index=116&type=chunk) - Reclassified cash flow hedge amounts to interest expense were less than **$1 million** for the three and nine months ended May 31, 2025[117](index=117&type=chunk) [Note 9 - Income Taxes](index=31&type=section&id=Note%209%20-%20Income%20Taxes) This note provides details on the company's effective tax rate and the factors influencing its income tax expense or benefit Effective Tax Rate from Continuing Operations | Period | 2025 | 2024 | | :-------------------------- | :----- | :----- | | 3 Months Ended May 31 | 2.0% | 18.3% | | 9 Months Ended May 31 | 0.9% | 17.6% | - The effective tax rate was **lower than the U.S. federal statutory rate of 21%** primarily due to an **increase in the valuation allowance** against deferred tax assets in the U.S. tax jurisdiction[118](index=118&type=chunk)[119](index=119&type=chunk) [Note 10 - Net Income (Loss) Per Share](index=32&type=section&id=Note%2010%20-%20Net%20Income%20%28Loss%29%20Per%20Share) This note presents the calculation of basic and diluted net income or loss per share attributable to Radius shareholders Net Income (Loss) Per Share Attributable to Radius Shareholders (in thousands, except per share) | Metric | 3 Months Ended May 31, 2025 | 3 Months Ended May 31, 2024 | 9 Months Ended May 31, 2025 | 9 Months Ended May 31, 2024 | | :------------------------------------------ | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | | Net income (loss) attributable to Radius shareholders | $(16,964) | $(198,390) | $(87,114) | $(250,333) | | Basic EPS | $(0.59) | $(6.97) | $(3.04) | $(8.82) | | Diluted EPS | $(0.59) | $(6.97) | $(3.04) | $(8.82) | | Weighted average common shares outstanding, basic | 28,700 | 28,479 | 28,652 | 28,385 | [Note 11 - Related Party Transactions](index=32&type=section&id=Note%2011%20-%20Related%20Party%20Transactions) This note discloses transactions with related parties, specifically recycled metal purchases from a joint venture Recycled Metal Purchases from Joint Venture (in thousands) | Period | 2025 | 2024 | | :-------------------------- | :----- | :----- | | 3 Months Ended May 31 | $5,000 | $5,000 | | 9 Months Ended May 31 | $13,000 | $13,000 | [Note 12 - Debt](index=32&type=section&id=Note%2012%20-%20Debt) This note details the company's debt structure, including revolving credit facilities, finance lease liabilities, and other obligations Debt (in thousands) | Category | May 31, 2025 | August 31, 2024 | | :------------------------------------------ | :----------- | :-------------- | | Bank revolving credit facilities | $435,000 | $393,612 | | Finance lease liabilities | $7,319 | $9,042 | | Other debt obligations | $12,094 | $12,116 | | **Total debt** | **$454,413** | **$414,770** | - On June 16, 2025, the Company amended its credit agreement, reducing revolving commitments from **$800 million to $625 million** and extending the **suspension of the minimum permitted fixed charge coverage ratio covenant**[125](index=125&type=chunk)[186](index=186&type=chunk) - The weighted average interest rate on outstanding credit facilities decreased from **8.0%** as of August 31, 2024, to **7.0%** as of May 31, 2025[128](index=128&type=chunk)[190](index=190&type=chunk) [Note 13 - Merger with TAI](index=33&type=section&id=Note%2013%20-%20Merger%20with%20TAI) This note provides an update on the merger agreement with TAI, including terms, shareholder approval, and expected closing timeline - On March 13, 2025, the Company entered into a **Merger Agreement** with **TAI**, where **Radius Recycling** will become a **wholly-owned subsidiary of TAI**[131](index=131&type=chunk) - Each share of Radius Common Stock will be converted into the right to receive **$30.00 in cash** (Merger Consideration)[132](index=132&type=chunk) - The merger was **approved by shareholders on June 5, 2025**, and is expected to close in the **second half of calendar year 2025**, subject to remaining regulatory approvals[139](index=139&type=chunk)[140](index=140&type=chunk)[141](index=141&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=36&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section provides management's perspective on the Company's financial condition and results of operations for the three and nine months ended May 31, 2025, compared to the prior year periods, highlighting key drivers, market conditions, and the impact of strategic initiatives and corporate events [General](index=36&type=section&id=General) This section provides an overview of Radius Recycling's business model, operations, and key factors influencing its financial performance - Radius Recycling is a **vertically integrated recycler** of ferrous and nonferrous metal and a manufacturer of **finished steel products**[145](index=145&type=chunk) - The Company operates **50 retail self-service auto parts stores**, **53 metals recycling facilities**, and an **electric arc furnace (EAF) steel mill**[145](index=145&type=chunk) - Results depend on demand and prices for recycled metal, raw material supply, operating leverage from higher volumes, and efficient metal extraction[150](index=150&type=chunk) [Merger with TAI](index=37&type=section&id=Merger%20with%20TAI) This section provides an update on the proposed merger with TAI, including the acquisition terms and approval status - The Company entered a Merger Agreement with TAI on March 13, 2025, to be acquired for **$30.00 per share in cash**[152](index=152&type=chunk) - The merger has been **approved by the Board of Directors and shareholders** and is expected to close in the **second half of calendar year 2025**, subject to customary closing conditions[152](index=152&type=chunk) [Everett Facility Shredder Fire](index=37&type=section&id=Everett%20Facility%20Shredder%20Fire) This section details the resolution of property damage and business income insurance claims related to the December 2021 fire at the Everett facility - Repairs and replacement of property damaged by the December 2021 fire at the Everett facility were substantially completed by the **end of fiscal 2023**[153](index=153&type=chunk) - All insurance claims for property damage and business income losses related to the fire were **fully settled and recognized by August 31, 2024**, including a **$7 million gain** in Q3 fiscal 2024[153](index=153&type=chunk) [Use of Non-GAAP Financial Measures](index=38&type=section&id=Use%20of%20Non-GAAP%20Financial%20Measures) This section explains the company's use of non-GAAP financial measures, such as adjusted EBITDA, to provide additional insights into performance - Non-GAAP financial measures like **Adjusted EBITDA** are used to provide a meaningful presentation of operating and financial performance, excluding items not related to underlying business operations[155](index=155&type=chunk) - Adjusted EBITDA excludes items such as **restructuring charges**, **impairment charges**, **amortization of cloud computing costs**, **legacy environmental charges**, and **business development costs**[155](index=155&type=chunk) [Financial Highlights of Results of Operations for the Third Quarter of Fiscal 2025](index=39&type=section&id=Financial%20Highlights%20of%20Results%20of%20Operations%20for%20the%20Third%20Quarter%20of%20Fiscal%202025) This section summarizes key financial performance indicators for the third quarter of fiscal 2025, highlighting drivers of improvement - Significant financial performance improvement in Q3 fiscal 2025 was driven by **stronger nonferrous market conditions**, **higher finished steel sales volumes**, and **productivity initiatives**[160](index=160&type=chunk) Financial Highlights (in thousands, except per share) | Metric | 3 Months Ended May 31, 2025 | 3 Months Ended May 31, 2024 | Change | | :------------------------------------------ | :-------------------------- | :-------------------------- | :----- | | Diluted loss per share from continuing operations | $(0.59) | $(6.97) | (92%) | | Adjusted diluted loss per share from continuing operations | $(0.39) | $(0.59) | (34%) | | Net loss | $(16,000) | $(199,000) | (92%) | | Adjusted EBITDA | $22,000 | $9,000 | 155% | - Nonferrous sales volumes hit a record high, up **17% YoY**, with average net selling prices **6% higher**. Finished steel sales volumes increased **20% YoY**[160](index=160&type=chunk) [Results of Operations](index=40&type=section&id=Results%20of%20Operations) This section provides a detailed analysis of the company's revenues, gross margin, expenses, and net income for the reporting periods Selected Financial Measures and Operating Statistics (in thousands, except prices and per share amounts) | Metric | 3 Months Ended May 31, 2025 | 3 Months Ended May 31, 2024 | 9 Months Ended May 31, 2025 | 9 Months Ended May 31, 2024 | | :------------------------------------------ | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | | Total revenues | $726,991 | $673,920 | $2,026,036 | $1,967,876 | | Gross margin | $49,547 | $45,530 | $110,449 | $125,070 | | Selling, general and administrative expense | $56,350 | $62,100 | $167,977 | $187,362 | | Net income (loss) | $(16,406) | $(198,511) | $(86,300) | $(250,320) | | Adjusted EBITDA | $22,014 | $8,618 | $21,562 | $12,475 | | Average nonferrous sales price ($/pound) | $1.10 | $1.04 | $1.05 | $0.97 | | Nonferrous volumes (pounds, in thousands) | 215,253 | 183,230 | 566,831 | 541,435 | | Finished steel sales volumes (ST, in thousands) | 151 | 126 | 407 | 369 | - Nonferrous sales volumes increased **17% in Q3** and **5% in the first nine months of fiscal 2025**, with average net selling prices up **6% and 8% respectively**[170](index=170&type=chunk) - SG&A expense decreased **9% in Q3** and **10% in the first nine months of fiscal 2025**, reflecting benefits from cost reduction measures[172](index=172&type=chunk) [Liquidity and Capital Resources](index=41&type=section&id=Liquidity%20and%20Capital%20Resources) This section discusses the company's cash position, debt levels, operating cash flows, capital expenditures, and dividend policy Liquidity and Debt Metrics (in thousands) | Metric | May 31, 2025 | August 31, 2024 | | :-------------------------- | :----------- | :-------------- | | Cash balances | $16,000 | $6,000 | | Debt | $454,000 | $415,000 | | Debt, net of cash | $438,000 | $409,000 | - Net cash provided by operating activities was **$21 million** in the first nine months of fiscal 2025, compared to net cash used of **$57 million** in the prior year[179](index=179&type=chunk) - Capital expenditures totaled **$34 million** for the first nine months of fiscal 2025, with a plan to invest approximately **$60 million** in fiscal 2025, including **$14 million for environmental projects**[183](index=183&type=chunk)[196](index=196&type=chunk)[197](index=197&type=chunk) - The Company declared a quarterly dividend of **$0.1875 per common share**, equating to an annual cash dividend of **$0.75 per common share**[199](index=199&type=chunk) [Contractual Obligations](index=46&type=section&id=Contractual%20Obligations) This section confirms no material changes to contractual obligations since the last annual report and notes outstanding letters of credit - No material changes to contractual obligations since the last Annual Report on Form 10-K[204](index=204&type=chunk) - The Company maintains **$9 million** outstanding under **stand-by letters of credit**[204](index=204&type=chunk) [Critical Accounting Estimates](index=46&type=section&id=Critical%20Accounting%20Estimates) This section confirms no material changes to critical accounting estimates since the last annual report - No material changes to critical accounting estimates since the last Annual Report on Form 10-K[205](index=205&type=chunk) [Recently Issued Accounting Standards](index=46&type=section&id=Recently%20Issued%20Accounting%20Standards) This section discusses the impact of recently issued accounting standards, specifically ASU 2024-03, on the company's financial statements - **ASU 2024-03, Disaggregation of Income Statement Expenses**, is effective for the Company's **fiscal 2028** and is not expected to have a **material impact** on consolidated financial statements[60](index=60&type=chunk)[206](index=206&type=chunk) [Non-GAAP Financial Measures](index=46&type=section&id=Non-GAAP%20Financial%20Measures) This section provides reconciliations and definitions for non-GAAP financial measures, including debt net of cash and adjusted EBITDA Debt, Net of Cash (in thousands) | Metric | May 31, 2025 | August 31, 2024 | | :-------------------------- | :----------- | :-------------- | | Total debt | $454,413 | $414,770 | | Less cash and cash equivalents | $16,214 | $5,552 | | **Total debt, net of cash** | **$438,199** | **$409,218** | Net Borrowings (Repayments) of Debt (in thousands) | Period | 9 Months Ended May 31, 2025 | 9 Months Ended May 31, 2024 | | :-------------------------- | :-------------------------- | :-------------------------- | | Borrowings from long-term debt | $611,836 | $579,500 | | Repayments of long-term debt | $(572,026) | $(421,414) | | **Net borrowings (repayments) of debt** | **$39,810** | **$158,086** | Adjusted EBITDA (in thousands) | Metric | 3 Months Ended May 31, 2025 | 3 Months Ended May 31, 2024 | 9 Months Ended May 31, 2025 | 9 Months Ended May 31, 2024 | | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | :-------------------------- | | Net income (loss) | $(16,406) | $(198,511) | $(86,300) | $(250,320) | | Interest expense | $9,131 | $7,368 | $26,764 | $17,981 | | Income tax expense (benefit) | $(328) | $(44,551) | $(814) | $(53,526) | | Depreciation and amortization | $23,683 | $24,406 | $71,749 | $72,188 | | Goodwill impairment charges | $— | $215,941 | $— | $215,941 | | **Adjusted EBITDA** | **$22,014** | **$8,618** | **$21,562** | **$12,475** | [Item 3. Quantitative and Qualitative Disclosures about Market Risk](index=50&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) This section discusses the Company's exposure to market risks, including commodity price risk (ferrous and nonferrous metals, finished steel), interest rate risk, and credit risk. The Company manages these risks through various strategies, such as adjusting purchase prices, using letters of credit, and monitoring credit limits - The Company is exposed to **commodity price risk** from variations in market prices for **ferrous and nonferrous metals** and **finished steel products**[218](index=218&type=chunk) - **Credit risk** is managed through letters of credit for exports, deposits for nonferrous sales, credit limits, and credit insurance, with **24% of accounts receivable** covered by letters of credit as of May 31, 2025[220](index=220&type=chunk)[222](index=222&type=chunk) - **Foreign currency exchange rate risk** is mainly associated with **sales transactions and accounts receivable denominated in USD by the Canadian subsidiary**[223](index=223&type=chunk) [Item 4. Controls and Procedures](index=51&type=section&id=Item%204.%20Controls%20and%20Procedures) The Company's management, including the CEO and CFO, concluded that its disclosure controls and procedures were effective at a reasonable assurance level as of May 31, 2025. There were no material changes in internal control over financial reporting during the quarter - Disclosure controls and procedures were **effective at a reasonable assurance level** as of May 31, 2025[225](index=225&type=chunk) - **No material changes** in internal control over financial reporting occurred during the quarter ended May 31, 2025[226](index=226&type=chunk) [PART II. OTHER INFORMATION](index=52&type=section&id=PART%20II.%20OTHER%20INFORMATION) This part includes disclosures on legal proceedings, risk factors, other information, and a list of exhibits [Item 1. Legal Proceedings](index=52&type=section&id=Item%201.%20Legal%20Proceedings) Information regarding reportable legal proceedings is incorporated by reference from the Annual Report on Form 10-K for fiscal year ended August 31, 2024, and Note 4 of this Quarterly Report, which details environmental and other legal contingencies - Legal proceedings information is incorporated by reference from the **Annual Report on Form 10-K** and **Note 4 of this report**[229](index=229&type=chunk) [Item 1A. Risk Factors](index=52&type=section&id=Item%201A.%20Risk%20Factors) There have been no material changes or new risk factors identified since the filing of the Annual Report on Form 10-K for the year ended August 31, 2024, except for those disclosed in the Quarterly Report for the period ended February 28, 2025 - **No material changes or new risk factors identified** since the last **Annual Report on Form 10-K**, except for those in the **Q1 fiscal 2025 10-Q**[230](index=230&type=chunk) [Item 5. Other Information](index=52&type=section&id=Item%205.%20Other%20Information) During the three months ended May 31, 2025, none of the Company's directors or officers adopted, terminated, or modified any Rule 10b5-1 or non-Rule 10b5-1 trading arrangements - **No directors or officers adopted, terminated, or modified Rule 10b5-1 or non-Rule 10b5-1 trading arrangements** during the three months ended May 31, 2025[231](index=231&type=chunk) [Item 6. Exhibits](index=53&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed as part of the Form 10-Q, including the Merger Agreement, certifications from the CEO and CFO, and XBRL-related documents - Exhibits include the **Agreement and Plan of Merger with TAI**, **CEO and CFO certifications**, and **Inline XBRL documents**[234](index=234&type=chunk) [SIGNATURES](index=54&type=section&id=SIGNATURES) This section formally attests to the accuracy of the report, signed by the company's principal executive and financial officers - The report is signed by **Tamara L. Lundgren** (Chairman, President, and CEO) and **Stefano R. Gaggini** (SVP and CFO) on **July 1, 2025**[237](index=237&type=chunk)
Radius Recycling (RDUS) Reports Q3 Loss, Beats Revenue Estimates
ZACKS· 2025-07-01 14:36
Group 1 - Radius Recycling reported a quarterly loss of $0.39 per share, significantly better than the Zacks Consensus Estimate of a loss of $0.87, representing an earnings surprise of +55.17% [1] - The company posted revenues of $726.99 million for the quarter ended May 2025, exceeding the Zacks Consensus Estimate by 7.38% and showing an increase from $673.92 million year-over-year [2] - Radius Recycling shares have increased approximately 95.1% since the beginning of the year, outperforming the S&P 500's gain of 5.5% [3] Group 2 - The earnings outlook for Radius Recycling is mixed, with the current consensus EPS estimate for the coming quarter at -$0.56 on revenues of $663 million, and -$3.84 on revenues of $2.62 billion for the current fiscal year [7] - The Zacks Industry Rank indicates that the Waste Removal Services sector is currently in the bottom 30% of over 250 Zacks industries, which may impact the stock's performance [8]
Radius Recycling(RDUS) - 2025 Q3 - Quarterly Results
2025-07-01 12:00
[Sixth Amendment to Third Amended and Restated Credit Agreement](index=1&type=section&id=Sixth%20Amendment%20to%20Third%20Amended%20and%20Restated%20Credit%20Agreement) This document details the Sixth Amendment to the Third Amended and Restated Credit Agreement, modifying terms for Radius Recycling and its lenders [Introduction and Parties](index=1&type=section&id=Introduction%20and%20Parties) This section introduces the Sixth Amendment to the credit agreement, effective June 16, 2025, involving Radius Recycling, its Canadian subsidiary, and various lenders - The agreement, effective **June 16, 2025**, is the sixth amendment to the credit agreement originally dated April 6, 2016[1](index=1&type=chunk)[3](index=3&type=chunk) - Key parties include **Radius Recycling, Inc.** and its Canadian subsidiary as Borrowers, with **Bank of America, N.A.** as the Administrative Agent[1](index=1&type=chunk) [Amendments to Existing Credit Agreement](index=1&type=section&id=1.%20Amendments%20to%20Existing%20Credit%20Agreement) This section details specific modifications to the existing credit agreement, including revised definitions, new terms, stricter reporting, and adjusted financial covenants [Amended Definitions](index=1&type=section&id=1(a).%20Amended%20Definitions) This subsection revises key definitions, updating aggregate commitment amounts and modifying EBITDA calculations to include or exclude specific non-recurring items Revised Aggregate Commitments | Commitment Type | Aggregate Principal Amount | | :--- | :--- | | Aggregate Commitments A-1 | $585,937,500 | | Aggregate Commitments A-2 | $39,062,500 | - The definition of EBITDA is amended to allow add-backs, including up to **$50 million** for Environmental Liabilities, **$50 million** for Productivity Improvement Expenses, and all direct expenses for the RDUS Merger Transaction after December 1, 2024[6](index=6&type=chunk) - Up to **$75 million** in gains from certain asset dispositions may be included in EBITDA during the remaining term[6](index=6&type=chunk) [New Definitions](index=3&type=section&id=1(b).%20New%20Definitions) This subsection introduces new definitions for the "RDUS Merger Transaction," formalizing the acquisition by Toyota Tsusho America, Inc., and the "Sixth Amendment Effective Date" - The **"RDUS Merger Transaction"** is defined as the acquisition of the US Borrower by **Toyota Tsusho America, Inc.**, per the merger agreement dated March 13, 2025[9](index=9&type=chunk) - The **"Sixth Amendment Effective Date"** is established as **June 16, 2025**[10](index=10&type=chunk) [New Reporting and Cooperation Requirements](index=3&type=section&id=1(c)%20%26%201(e).%20New%20Reporting%20and%20Cooperation%20Requirements) This subsection introduces stricter reporting, requiring monthly financial statements, weekly cash flow forecasts, long-term projections, and cooperation with a financial advisor - Commencing **September 30, 2025**, the US Borrower must provide monthly condensed consolidated financial statements within **30-40 days** of month-end[10](index=10&type=chunk) - Starting **December 31, 2025**, a rolling **13-week cash flow forecast** with variance analysis is required monthly[11](index=11&type=chunk) - A new requirement mandates cooperation with a financial advisor engaged by the Administrative Agent, with costs reimbursed by the US Borrower starting **October 1, 2025**[12](index=12&type=chunk) [Amended Financial Covenants](index=4&type=section&id=1(f)%20%26%201(g).%20Amended%20Financial%20Covenants) This subsection modifies key financial covenants, setting the Consolidated Asset Coverage Ratio and adjusting the Consolidated Interest Coverage Ratio for specific fiscal quarters Updated Financial Covenant Ratios | Covenant | Requirement | As of Fiscal Quarter Ending | | :--- | :--- | :--- | | Consolidated Asset Coverage Ratio | Must be ≥ 1.00 to 1.00 | Any fiscal quarter | | Consolidated Interest Coverage Ratio | Must be ≥ 2.00 to 1.00 | May 31, 2024 | | Consolidated Interest Coverage Ratio | Must be ≥ 1.25 to 1.00 | Feb 28, 2025 & Feb 28, 2026 | [Conditions Precedent](index=5&type=section&id=2.%20Conditions%20Precedent) This section outlines conditions for the Sixth Amendment's effectiveness, including executed documents, loan prepayments, fee payments, and satisfactory lender due diligence - The amendment requires receipt of executed counterparts from each Loan Party, the Required Lenders, and the Administrative Agent[17](index=17&type=chunk) - Commitments are permanently reduced, requiring the US Borrower to make prepayments to align with new Aggregate Commitments A-1 of **$585.9 million** and A-2 of **$39.1 million**[18](index=18&type=chunk) - Effectiveness is contingent on payment of all required fees, reimbursement of Administrative Agent's expenses, and satisfactory completion of lender due diligence, including KYC and Patriot Act compliance[19](index=19&type=chunk)[20](index=20&type=chunk) [Miscellaneous Provisions](index=6&type=section&id=3.%20%26%204.%20Miscellaneous%20Provisions) This section covers legal clauses, affirming the original Loan Documents, ratifying obligations, providing representations and warranties, and releasing claims against the Lender Group - The Loan Parties ratify and confirm that all Loan Documents and Collateral Documents remain in full force and effect[24](index=24&type=chunk)[25](index=25&type=chunk) - Each Loan Party represents and warrants its authority to enter the amendment and confirms no Default has occurred or is continuing after its effect[27](index=27&type=chunk) - The amendment and any related disputes are governed by the laws of the **State of New York**[33](index=33&type=chunk) - The Loan Parties provide a general release of all claims against the Lender Group up to the amendment date, explicitly waiving rights under **Section 1542 of the California Civil Code**[35](index=35&type=chunk)[36](index=36&type=chunk) [Signatories and Schedules](index=9&type=section&id=Signatories%20and%20Schedules) This final section contains signature pages formally executing the amendment by Borrowers, Guarantors, the Administrative Agent, and all Lenders, also amending Schedule 2.01 - The amendment is executed by the Borrowers, Guarantor subsidiaries, the Administrative Agent, and all US and Canadian lenders party to the agreement[38](index=38&type=chunk)[50](index=50&type=chunk)[51](index=51&type=chunk)[65](index=65&type=chunk) - **Schedule 2.01**, listing lender commitments, is formally amended and restated as part of this agreement[17](index=17&type=chunk)[66](index=66&type=chunk)
Radius Recycling Reports Third Quarter Fiscal 2025 Financial Results
Globenewswire· 2025-07-01 12:00
Core Viewpoint - Radius Recycling, Inc. reported significant improvements in its financial performance for the third quarter of fiscal 2025, with higher sales volumes across ferrous, nonferrous, and finished steel products, leading to a notable reduction in losses compared to previous quarters [2][3][4]. Financial Performance - The company reported a loss per share from continuing operations of $(0.59) and a net loss of $(16) million for the third quarter, an improvement from $(1.15) and $(33) million in the second quarter [2][3]. - Adjusted EBITDA was $22 million in the third quarter, a significant improvement from approximately break-even in the prior quarter [3][33]. - The adjusted loss per share from continuing operations was $(0.39) in the third quarter, compared to $(0.99) in the second quarter [3][32]. Sales Volumes and Market Conditions - Nonferrous sales volumes increased by 23% sequentially, driven by strong domestic demand and higher average net selling prices, which rose by 7% [4][5]. - Ferrous sales volumes were up 4% sequentially, with average net selling prices increasing by 3% despite a volatile market environment [5][6]. - Finished steel sales volumes increased by 15% sequentially, attributed to stronger construction activity and healthy demand in Western markets [6][7]. Operational Metrics - Rolling mill utilization reached 107%, significantly higher than 88% in the prior quarter, contributing to improved operating leverage and margin expansion [6][7]. - The company generated positive operating cash flow of $3 million during the third quarter [7]. Debt and Capital Management - Total debt at the end of the quarter was $454 million, with net debt (debt minus cash) at $438 million [7][35]. - Capital expenditures for the quarter were $10 million [7]. Dividend Declaration - The Board of Directors declared a cash dividend of $0.1875 per common share, marking the 125th consecutive quarterly dividend [9][10]. Merger Activity - The company is in the process of merging with Toyota Tsusho America, Inc., with shareholder approval already obtained, and the merger expected to close in the second half of calendar year 2025, pending regulatory approvals [10][11].
Radius Recycling (RDUS) Earnings Call Presentation
2025-06-24 13:14
Transaction Overview - Toyota Tsusho will acquire Radius Recycling to accelerate investment in future growth[1] - The transaction delivers significant, immediate cash value to Radius shareholders[8] - The purchase price is $3000 per share in cash[32] - This represents a premium of approximately 115% to Radius' closing share price on March 12, 2025[33] - It also represents a premium of approximately 102% over the 90-day VWAP of Radius common stock[33] - The implied total enterprise value is approximately $134 billion, including net debt[33] - The transaction is expected to close in the second half of calendar year 2025[32] Strategic Rationale - Radius Recycling generated $27 billion in revenue in 2024[12] - Toyota Tsusho generated $65 billion in revenue in 2024[18] - Toyota Tsusho will invest in the development of Radius' infrastructure and manufacturing capabilities across its operating sites[10] - Radius will operate as a wholly-owned subsidiary of Toyota Tsusho, retaining its teams, facilities, strategy, and brands[22]
RDUS Investors Have the Opportunity to Join Investigation of Radius Recycling, Inc. with the Schall Law Firm
Prnewswire· 2025-04-28 21:34
Core Viewpoint - The Schall Law Firm is investigating potential breaches of fiduciary duty by the directors and management of Radius Recycling, Inc. in relation to a merger agreement with Toyota Tsusho America, Inc. [1][2] Group 1: Investigation Details - The investigation aims to determine if the Radius board acted in the best interests of shareholders during the merger process [2] - Radius announced a definitive merger agreement on March 13, 2025, where Toyota Tsusho America will acquire all shares of Radius for $30.00 per share in cash [2] - The acquisition price represents an approximate 115% premium to Radius' closing share price on March 12, 2025, and an approximate 102% premium over the 90-day volume-weighted average share price [2]
Radius Recycling(RDUS) - 2025 Q2 - Quarterly Report
2025-04-04 16:46
Financial Performance - In Q2 fiscal 2025, average net selling prices for ferrous products decreased by 14% compared to the prior year quarter, influenced by high levels of Chinese steel exports[151]. - Average net selling prices for finished steel products in Q2 fiscal 2025 were 9% lower than the prior year quarter, contributing to lower metal spreads[151]. - The net loss for Q2 fiscal 2025 was $33 million, a slight improvement from a net loss of $34 million in the prior year quarter[154]. - Adjusted EBITDA for Q2 fiscal 2025 was break-even, compared to $3 million in the prior year quarter[154]. - Net loss for Q2 2025 was $32,965,000, a 3% improvement from $34,010,000 in Q2 2024, and for the first six months, the loss was $69,894,000 compared to $51,808,000 in the prior year[162]. - Adjusted EBITDA for the six months ended February 28, 2025, was $(452) thousand, a decrease from $3,858 thousand for the same period in 2024[202]. - Diluted loss per share from continuing operations attributable to Radius shareholders was $(1.15) for the three months ended February 28, 2025, compared to $(1.19) for the same period in 2024[206]. Revenue and Sales - Ferrous revenues for Q2 2025 were $318,955,000, a 1% increase from $316,097,000 in Q2 2024, while nonferrous revenues increased by 9% to $179,012,000 from $164,481,000[157]. - Total revenues for the first six months of fiscal 2025 were $1,299,045,000, remaining flat compared to $1,293,956,000 in the prior year[161]. - Average net selling prices for nonferrous products increased by 10% in both Q2 and the first six months of fiscal 2025, while ferrous product prices decreased by 14% and 9%, respectively[161]. Cash Flow and Operating Activities - For the first six months of fiscal 2025, net cash provided by operating activities was $18 million, a significant improvement from net cash used of $56 million in the prior year period[155]. - Net cash provided by operating activities in the first six months of fiscal 2025 was $18,000,000, a significant improvement from a net cash used of $56,000,000 in the same period of fiscal 2024[170]. - Net cash provided by financing activities was $1,000,000 in the first six months of fiscal 2025, a decrease from $108,000,000 in the prior year[175]. Debt and Capital Expenditures - Debt increased to $430 million as of February 28, 2025, up from $415 million as of August 31, 2024, primarily due to increased borrowings for working capital and capital expenditures[155]. - Capital expenditures in the first six months of fiscal 2025 were $23,000,000, focused on upgrading equipment and investing in advanced technologies[174]. - Capital expenditures for the first six months of fiscal 2025 totaled $23 million, down from $40 million in the prior year, with a planned investment of approximately $60 million for the full fiscal year[187]. Cost Management - The company implemented productivity and cost reduction initiatives that led to a 12% reduction in selling, general and administrative expenses in Q2 fiscal 2025 compared to the prior year quarter[151]. - Selling, general and administrative (SG&A) expenses decreased by 12% in Q2 2025 and 11% in the first six months, reflecting cost reduction measures[163]. - Interest expense increased to $9,000,000 in Q2 2025 from $6,000,000 in Q2 2024, primarily due to higher average borrowings and interest rates[165]. Shareholder Actions - The Board of Directors declared a dividend of $0.1875 per common share for the second quarter of fiscal 2025, equating to an annual cash dividend of $0.75 per common share[190]. - The company had remaining authorization to repurchase up to 2.8 million shares of Class A common stock as of February 28, 2025, but did not repurchase any shares during the second quarter of fiscal 2025[191]. Risk Management - The company actively manages commodity price risk, with a 10% decrease in estimated selling price of inventory not having a material impact on net realizable value as of February 28, 2025[210]. - As of February 28, 2025, 17% of accounts receivable was covered by letters of credit, compared to 28% as of August 31, 2024[214]. Other Significant Events - The company entered into a Merger Agreement with Toyota Tsusho America, Inc., with each share of Radius Common Stock to be converted into $30.00 in cash upon closing[142]. - The company experienced a fire at its Everett facility in December 2021, with insurance claims resulting in an additional $6 million recognized in the first half of fiscal 2024[143]. - Business development costs for the three months ended February 28, 2025, were $2,541 thousand, compared to $140 thousand for the same period in 2024[202]. - Restructuring charges and other exit-related activities amounted to $1,422 thousand for the three months ended February 28, 2025, down from $3,175 thousand in the same period in 2024[202].
Radius Recycling (RDUS) Reports Q2 Loss, Tops Revenue Estimates
ZACKS· 2025-04-04 14:50
Core Viewpoint - Radius Recycling reported a quarterly loss of $0.99 per share, which was better than the Zacks Consensus Estimate of a loss of $1.08, indicating an earnings surprise of 8.33% [1] - The company has shown mixed trends in earnings estimate revisions, currently holding a Zacks Rank 3 (Hold) [6] Financial Performance - For the quarter ended February 2025, Radius Recycling posted revenues of $642.51 million, surpassing the Zacks Consensus Estimate by 3.30% and showing an increase from $621.06 million year-over-year [2] - The company has surpassed consensus EPS estimates three times over the last four quarters [2] Stock Performance - Radius Recycling shares have increased by approximately 91.3% since the beginning of the year, contrasting with the S&P 500's decline of -8.3% [3] Future Outlook - The current consensus EPS estimate for the upcoming quarter is -$0.87 on revenues of $677 million, and for the current fiscal year, it is -$3.84 on revenues of $2.62 billion [7] - The outlook for the Waste Removal Services industry, where Radius Recycling operates, is currently in the bottom 26% of over 250 Zacks industries, which may impact the stock's performance [8]
Radius Recycling(RDUS) - 2025 Q2 - Quarterly Results
2025-04-04 12:30
Financial Performance - Radius Recycling reported a net loss of $(33) million in Q2 2025, compared to $(34) million in Q2 2024, with an adjusted loss per share of $(0.99) versus $(1.04) year-over-year[3]. - Adjusted EBITDA was approximately break-even in Q2 2025, a decline from $3 million in Q2 2024[3]. - Net income for Q2 2025 was a loss of $33 million, compared to a loss of $34 million in Q2 2024[30]. - Adjusted diluted earnings per share for Q2 2025 were $(0.99), compared to $(1.33) in Q2 2024[28]. - Net income per share for Q2 2025 was $(1.15), compared to $(1.30) in Q1 2025 and $(1.19) in Q2 2024[16]. Sales and Volumes - Ferrous sales volumes increased by 12% year-over-year, totaling 1,094 thousand long tons, while average net ferrous sales prices decreased by 14% to $330 per long ton[5][11]. - Finished steel sales volumes rose by 15% year-over-year, reaching 131 thousand short tons, despite a 9% decline in average net selling prices to $756 per short ton[5][12]. - Total ferrous volumes for Q2 2025 were 1,094 thousand LT, down from 1,106 thousand LT in Q1 2025[18]. - Total nonferrous volumes for Q2 2025 were 174,323 thousand pounds, compared to 177,255 thousand pounds in Q1 2025[18]. - Average ferrous selling price for domestic sales in Q2 2025 was $353 per LT, a decrease from $331 per LT in Q1 2025[18]. - Finished steel average sales price in Q2 2025 was $756 per ST, down from $775 per ST in Q1 2025[18]. Cash Flow and Debt - The company generated positive operating cash flow of $20 million and free cash flow of $13 million in Q2 2025, with total debt at $430 million[4]. - Free cash flow for Q2 2025 was $12.9 million, with cash flow from operating activities at $19.95 million[33]. - Total debt as of February 2025 was $429.9 million, a decrease from $445.4 million in November 2024[32]. Operational Efficiency - Radius Recycling's SG&A expenses decreased by 12% year-over-year to $55 million, driven by productivity initiatives[5]. - The mill utilization rate improved to 88% in Q2 2025, compared to 81% in the prior year's second quarter[12]. - Rolling mill utilization for Q2 2025 was 88%, compared to 81% in Q1 2025[18]. - Adjusted selling, general and administrative expenses for Q2 2025 were $53 million, down from $62 million in Q2 2024[31]. Future Outlook and Strategic Initiatives - Radius Recycling entered into a merger agreement with Toyota Tsusho America, Inc., expected to close in the second half of calendar 2025[8]. - The company is pursuing a merger with TAI, a subsidiary of Toyota Tsusho Corporation, which may impact future operations and growth strategies[37]. - The company is investing in processing and manufacturing technology improvements to enhance operational efficiency[37]. - The company anticipates potential impacts from supply chain disruptions and inflation on its financial performance[40]. - The company is focused on compliance with environmental regulations and managing associated costs[40]. Tax and Equity - The effective tax rate for Q2 2025 was a benefit of 11% on a pre-tax loss, reflecting a favorable true-up from changes in estimates[5]. - Total current assets as of February 28, 2025, were $546,161 thousand, down from $609,127 thousand as of August 31, 2024[25]. - Total liabilities as of February 28, 2025, were $913,179 thousand, compared to $908,029 thousand as of August 31, 2024[26]. - Total equity as of February 28, 2025, was $545,004 thousand, down from $625,740 thousand as of August 31, 2024[26].
Radius Recycling Reports Second Quarter Fiscal 2025 Financial Results
Newsfilter· 2025-04-04 12:30
Core Insights - Radius Recycling, Inc. reported a net loss of $33 million for the second quarter of fiscal 2025, slightly improved from a loss of $34 million in the same quarter of the previous year [3][11] - The company generated positive operating cash flow of $20 million and free cash flow of $13 million during the quarter [4][11] - The company declared a quarterly dividend of $0.1875 per share, marking its 124th consecutive quarterly dividend [7][11] Financial Performance - The adjusted loss per share from continuing operations was $(0.99) in Q2 2025, compared to $(1.04) in Q2 2024 [3][11] - Revenues for Q2 2025 were $643 million, up from $621 million in Q2 2024 [11][13] - The gross margin decreased to $27 million in Q2 2025 from $40 million in Q2 2024 [11][13] Sales and Pricing - Ferrous sales volumes increased by 12% year-over-year, while average net selling prices for ferrous products were 14% lower [6][11] - Nonferrous average net selling prices rose by 10%, although nonferrous sales volumes were down by 1% year-over-year [6][11] - Finished steel sales volumes increased by 15% year-over-year, despite a 9% decline in average net selling prices [6][11] Operational Metrics - The mill utilization rate improved to 88% in Q2 2025 from 81% in Q2 2024 [6][11] - The company implemented productivity initiatives that led to a 12% reduction in consolidated Selling, General, and Administrative (SG&A) costs compared to the prior year [6][11] - Capital expenditures for the quarter were $11 million [4][11] Debt and Cash Flow - Total debt at the end of Q2 2025 was $430 million, with net debt (debt minus cash) at $424 million [4][11] - The effective tax rate for the quarter was a benefit of 11% on a pre-tax loss, influenced by a favorable true-up from changes in performance estimates [5][11] Merger Update - Radius Recycling entered into a Merger Agreement with Toyota Tsusho America, Inc., anticipating the merger to close in the second half of calendar 2025 [8][11] - The company will not hold a second quarter earnings conference call due to the pending merger [9][11]