Note 15 - Segment Information

6 Months Ended

Jun. 30, 2022

Notes to Financial Statements

Segment Reporting Disclosure [Text Block]

15.   Segment Information:

The Company follows the accounting guidance that requires the utilization of a “management approach” to define and report the financial results of operating segments. The management approach defines operating segments along the lines used by the Company’s chief operating decision maker (CODM) to assess performance and make operating and resource allocation decisions. The CODM evaluates performance and allocates resources based primarily on operating income (loss). The operating segments are based primarily on internal management reporting.

The Company operates in three reportable segments; specialty metals flat products, carbon flat products, and tubular and pipe products. The specialty metals flat products segment and the carbon flat products segment are at times consolidated and referred to as the flat products segments, as certain of the flat products segments’ assets and resources are shared by the specialty metals and carbon flat products segments and both segments’ products are stored in the shared facilities and, in some locations, processed on shared equipment.

Corporate expenses are reported as a separate line item for segment reporting purposes. Corporate expenses include the unallocated expenses related to managing the entire Company (i.e., all three segments), including compensation for certain personnel, expenses related to being a publicly traded entity such as board of directors’ expenses, audit expenses and various other professional fees.

The following table provides financial information by segment and reconciles the Company’s operating income by segment to the consolidated income before income taxes for the three and six months ended June 30, 2022 and 2021, respectively.

	For the Three Months Ended						For the Six Months Ended
	June 30,						June 30,
(in thousands)	2022			2021			2022			2021
Net sales
Specialty metals flat products	$	226,964		$	138,035		$	426,443		$	264,354
Carbon flat products		370,665			325,511			750,214			571,884
Tubular and pipe products		111,547			92,531			228,852			182,963
Total net sales	$	709,176		$	556,077		$	1,405,509		$	1,019,201
Depreciation and amortization
Specialty metals flat products	$	1,008		$	901		$	2,013		$	1,804
Carbon flat products		2,698			2,949			5,372			5,872
Tubular and pipe products		1,222			1,404			2,508			2,796
Corporate		18			18			35			36
Total depreciation and amortization	$	4,946		$	5,272		$	9,928		$	10,508
Operating income
Specialty metals flat products	$	36,473		$	13,702		$	70,557		$	21,724
Carbon flat products		15,618			30,434			25,493			51,633
Tubular and pipe products		7,300			3,039			21,882			9,359
Corporate expenses		(5,526	)		(4,738	)		(10,945	)		(8,690	)
Total operating income	$	53,865		$	42,437		$	106,987		$	74,026
Other income (loss), net		(15	)		1			(21	)		(9	)
Income before interest and income taxes		53,850			42,438			106,966			74,017
Interest and other expense on debt		2,271			2,017			4,269			3,671
Income before income taxes	$	51,579		$	40,421		$	102,697		$	70,346

	For the Six Months Ended
	June 30,
(in thousands)	2022		2021
Capital expenditures
Flat products segments	$	8,236	$	3,496
Tubular and pipe products		1,786		1,083
Corporate		-		-
Total capital expenditures	$	10,022	$	4,579

	As of
	June 30,		December 31,
(in thouands)	2022		2021
Assets
Flat products segments	$	828,286	$	777,074
Tubular and pipe products		257,402		245,962
Corporate		428		536
Total assets	$	1,086,116	$	1,023,572

There were no material revenue transactions between the specialty metals products, carbon flat products and tubular and pipe products segments.

The Company sells certain products internationally, primarily in Canada and Mexico. International sales are immaterial to the consolidated financial results and to the individual segments’ results.