WS

Steel Dynamics (NASDAQ:STLD) is scheduled to report its earnings on Monday, October 19, 2026. The company has a market value of about $34.7 billion. Over the last twelve months it generated $20.5 billion in revenue and $2.2 billion in operating profit, with net income of $1.6 billion. How the stock moves after the release will depend on how the results and outlook compare with expectations. What history can offer is the base rate: how often, and how far, the stock has moved after past reports. See the earnings reaction history of all stocks How Often Has Steel Dynamics Stock Risen After Earnings? Some observations on one-day (1D) post-earnings returns, measured from the last close before each release: - There are 20 earnings releases in the last five years, with 10 positive and 10 negative one-day (1D) returns. Positive 1D returns were seen 50% of the time. - Over the last three years that share rises to 58%, across 12 releases. - The median of the 10 positive 1D returns is 4.2%, and the median of the 10 negative ones is -1.8%. - The largest one-day reactions were 10.0% and -4.1%. The table below shows the 1D, 5-day (5D) and 21-day (21D) returns after each release, followed by summary statistics. Earnings Date | 1D | 5D | 21D 7/21/2026 | 1.3% | 8.6% | 8.4% 4/21/2026 | 5.2% | 7.5% | 6.7% 1/27/2026 | 1.3% | 7.6% | 10.5% 10/21/2025 | 5.2% | 8.0% | 5.7% 7/22/2025 | -1.7% | -3.2% | -4.7% 4/23/2025 | 4.3% | 10.1% | 12.6% 1/23/2025 | -0.4% | 5.1% | 6.4% 10/17/2024 | 4.0% | -0.9% | 6.1% 7/18/2024 | -0.7% | -5.2% | -9.2% 4/24/2024 | -3.2% | -3.0% | -1.1% 1/24/2024 | 0.3% | 5.4% | 7.4% 10/19/2023 | -4.1% | -3.5% | 6.3% 7/20/2023 | -3.0% | -1.5% | 0.1% 4/21/2023 | -1.3% | -6.4% | -12.9% 1/26/2023 | 10.0% | 13.5% | 7.3% 10/20/2022 | 6.2% | 21.5% | 25.2% 7/21/2022 | 3.9% | 6.9% | 24.0% 4/22/2022 | -0.3% | -4.3% | -12.8% 1/26/2022 | -1.8% | 6.4% | 16.9% 10/21/2021 | -3.1% | -0.8% | -2.2% Statistic | 1D | 5D | 21D # Positive | 10 | 11 | 14 # Negative | 10 | 9 | 6 Median Positive | 4.2% | 7.6% | 7.4% Median Negative | -1.8% | -3.2% | -7.0% Max Positive | 10.0% | 21.5% | 25.2% Max Negative | -4.1% | -6.4% | -12.9% Do Early Post-Earnings Moves Continue? Another approach is to wait for the initial reaction and ask whether it tends to continue. The table below shows the correlation between the 1D return and the return over the following 5 and 21 trading days, and between the 5D return and the following 21 trading days. A value near 1 means the first move has tended to continue; near -1, to reverse; near 0, no consistent pattern. None of these correlations is strong enough to trade on: all are below 0.40 in absolute terms over five years, so the early post-earnings move has not reliably predicted what followed. History | 1D vs next 5D | 1D vs next 21D | 5D vs next 21D 5 Years | 0.28 | 0.09 | 0.28 3 Years | 0.20 | -0.03 | -0.12 Do Peers That Report First Offer A Clue? Commercial Metals (CMC) usually reports a few weeks before Steel Dynamics, and has already reported this season: its stock rose 0.1% the day after its October 15 report. The table compares each peer's one-day reaction to its own earnings with Steel Dynamics' one-day reaction to the report that followed, for the 14 quarters in which CMC reported first. The correlation is -0.14; the closer to 1, the more the peer's reaction has foreshadowed Steel Dynamics', and a negative value means it has tended to point the other way. STLD Earnings Date | STLD 1D | CMC 1D 7/21/2026 | 1.3% | 3.9% 4/21/2026 | 5.2% | -4.7% 1/27/2026 | 1.3% | -3.6% 10/21/2025 | 5.2% | -7.3% 7/22/2025 | -1.7% | 1.2% 1/23/2025 | -0.4% | 3.1% 7/18/2024 | -0.7% | 3.8% 1/24/2024 | 0.3% | 7.5% 10/19/2023 | -4.1% | -9.6% 7/20/2023 | -3.0% | 8.8% 4/21/2023 | -1.3% | 3.1% 1/26/2023 | 10.0% | -0.6% 10/20/2022 | 6.2% | 6.1% 1/26/2022 | -1.8% | 0.6% Correlation | - | -0.14 An earnings release can move one stock sharply in either direction. A diversified portfolio spreads that risk. The Trefis High Quality (HQ) Portfolio holds about 30 quality businesses, rebalanced with rules, and has a track record of outperforming a benchmark that combines the S&P 500, the S&P MidCap 400, and the Russell 2000.

This article first appeared on GuruFocus. - Net Sales: $2.7 billion, up approximately $1.9 billion year-over-year, primarily due to the addition of Kloeckner. - Adjusted EBITDA: $111 million; includes an estimated $43 million negative impact from purchase accounting inventory step-up. - Adjusted EPS: $0.57 per diluted share, compared with $0.77 in the prior year quarter. - Net Loss (Continuing Operations): $7 million, or $0.14 per diluted share, versus net earnings of $36.8 million, or $0.73 per diluted share, a year ago. - Adjusted EBIT: $78.5 million, up $23 million from the prior year quarter. - Net Interest Expense: $38.8 million, versus $2.9 million a year ago, reflecting acquisition-related debt. - Total Shipments: Approximately 1.9 million tons; mix of 77% direct sale and 23% toll processing, versus 63% direct and 37% toll a year ago. - Legacy Worthington Steel Net Sales: $954 million, up $81 million or 9% year-over-year on higher direct volumes and selling prices. - Legacy Shipments: Approximately 921,000 tons, down 1% year-over-year; direct sale volumes up 3%, total volumes down 8%. - Automotive Shipments: Direct shipments up 4% year-over-year. - Agriculture Shipments: Up 40% year-over-year, driven by OEM equipment and grain bin demand. - Other Transportation Shipments: Up 39%, primarily from share gains and new business. - Energy Shipments: Down 31% on customer sourcing shift to another supplier. - Construction Shipments: Down 9% on increased competition and tight steel availability. - Direct Spreads: Higher direct volumes added $7.6 million; favorable inventory holding gains added $6.5 million; direct spreads roughly flat excluding volume and holding gains. - Inventory Holding Gains: Estimated pretax gains of $12.1 million, versus $5.6 million a year ago; Q2 fiscal 2027 estimate of $10 million to $15 million in legacy business. - Toll Spreads: Lower toll volumes reduced legacy toll spreads by $2.3 million, partially offset by $1.4 million of improved mix. - Manufacturing Expenses: Legacy manufacturing expenses up approximately $11 million or 6%, on higher labor, benefits and freight costs. - SG&A: Legacy SG&A up $17.6 million, mainly acquisition-related expenses; up $2.9 million excluding acquisition fees and prior-year closing bonus. - Equity Earnings: Mexico-based joint venture earnings down approximately $1 million on lower direct volumes, partly offset by improved direct spreads. - Operating Cash Flow: Outflow of $6 million for the quarter. - Capital Expenditures: $63 million, resulting in negative free cash flow of $69 million; fiscal 2027 combined capex estimate of $160 million to $180 million. - Balance Sheet: Approximately $248 million of cash and $1.9 billion of net debt as of August 31; no trailing 12-month leverage ratio reported this quarter. - Dividend: Quarterly dividend of $0.16 per share declared, payable December 28, 2026. - Warning! GuruFocus has detected 6 Warning Signs with WS. - Is WS fairly valued? Test your thesis with our free DCF calculator. Release Date: October 07, 2026 For the complete transcript of the earnings call, please refer to the full earnings call transcript. - Worthington Steel Inc (NYSE:WS) completed the Kloeckner acquisition, significantly expanding its size, product capabilities, and geographic reach. - Legacy Worthington Steel Inc (NYSE:WS) achieved 9% year-over-year net sales growth to $954 million, driven by higher direct volumes and selling prices. - Automotive shipments increased 4% year-over-year, with new business wins and supplier awards from Subaru highlighting commercial strength. - Agriculture shipments surged 40% year-over-year, supported by strong OEM and grain bin demand. - Adjusted EBIT rose $23 million year-over-year to $78.5 million, and adjusted EBITDA was $111 million, or approximately $150 million excluding purchase accounting step-up. - Worthington Steel Inc (NYSE:WS) reported a net loss from continuing operations of $7 million, or $0.14 per diluted share, compared to net earnings of $36.8 million in the prior year quarter. - Adjusted earnings per share declined to $0.57 from $0.77 a year ago, pressured by higher interest expense following the acquisition. - Purchase accounting reduced first-quarter gross margin and adjusted EBITDA by an estimated $43 million due to the step-up of acquired inventory. - Net debt stands at approximately $1.9 billion, and the company is not reporting a trailing 12-month leverage ratio this quarter due to the acquisition timing. - Legacy energy shipments fell 31% and construction shipments declined 9%, reflecting customer sourcing shifts, increased competition, and tight steel availability. Q: Despite the tight supply environment, legacy Worthington direct tons were down less than 1% sequentially in the first quarter, much better than normal seasonality. What drove that volume beat?A: CEO Geoffrey Gilmore attributed the performance to continued market share gains in heavy truck, agriculture, and automotive. He added that the company likely missed out on another 30,000 tons of shipments during the quarter due to supply chain constraints. Q: Galvanized spreads averaged over $200 in the fiscal first quarter, well above long-term averages and trough levels. What is your stance on the sustainability of these spreads as hot rolled pricing rises?A: CEO Geoffrey Gilmore said sustainability is "an absolute go," citing a tight market with very limited imports. He noted that 90% or more of the business is contractual, so the company could not fully benefit from spread expansion this quarter, but the new contract season starting January 1 would begin to reflect it. Q: Can you give a clearer view of Kloeckner's normalized EBITDA in Q1, excluding the purchase accounting inventory step-up and other items, plus color on earnings across North America and Europe?A: CFO Timothy Adams declined to disclose segment-level data, noting no vetted pro forma is available. He confirmed the $43 million inventory step-up was non-cash and was not adjusted out of the $111 million adjusted EBITDA, so adding it back gets to roughly $150 million, which is more representative of EBITDA. Q: Could you explain the German law details under which the 38% minority holders retain their shares, and how long they can retain them?A: CEO Geoffrey Gilmore explained that once the DPLTA is approved by shareholders and declared effective by German courts, minority shareholders receive a put option to sell at EUR11 per share. If they choose to remain, they receive an annual guaranteed cash compensation of 6%, or EUR0.66 per share, and can hold their shares as long as they like. Q: Could you explain the difference in inventory turnover and gross margin between the Kloeckner and legacy Worthington businesses?A: CFO Timothy Adams said Worthington's gross margins are higher because of higher value-added processes such as galvanizing and pickling, while Kloeckner buys galvanized product. He noted this is a synergy opportunity, with Worthington eventually making galvanized for Kloeckner, and that a big chunk of the $150 million working capital synergy target relates to inventory management improvements. Q: How much of Kloeckner's U.S. sourcing comes from domestic mills versus imports?A: CEO Geoffrey Gilmore said Kloeckner and Worthington share very similar strategies of buying where they produce, with about 99% of Kloeckner's purchases coming from domestic mills. He highlighted the highly complementary footprints, with Worthington strong in the Midwest and Kloeckner bigger in the Southeast and pushing Southwest. Q: What is the status of the Kloeckner transaction and the DPLTA, and when would integration and synergy capture begin?A: CEO Geoffrey Gilmore said the transaction closed June 3, Kloeckner shares were delisted from the Frankfurt Stock Exchange on August 12, and the DPLTA was signed September 8. Subject to shareholder approval in October, it would provide a framework for operating control and formal integration and synergy capture beginning in the first quarter of calendar year 2027. Q: What drove the legacy Worthington Steel results, and how did shipments perform by end market?A: CFO Timothy Adams reported legacy net sales of $954 million, up 9% year-over-year, on total legacy shipments of about 921,000 tons, down 1%. Direct sale volumes rose 3%, with automotive direct shipments up 4%, agriculture up 40%, and other transportation up 39%, substantially offset by energy shipments down 31% and construction down 9%. Q: What is the outlook for inventory holding gains in the legacy business for the second quarter of fiscal 2027?A: CFO Timothy Adams said hot rolled coil prices ended the quarter around $1,200 per ton, with tight supply and expected mill maintenance outages likely to keep lead times extended. Given lagging index-based contract pricing, he estimated pre-tax inventory holding gains of $10 million to $15 million in the legacy business for the second quarter. Q: What are the capital spending plans and balance sheet priorities following the Kloeckner acquisition?A: CFO Timothy Adams said first quarter capital expenditures were $63 million, roughly split evenly between legacy Worthington and Kloeckner, with a full-year planning estimate of $160 million to $180 million for fiscal 2027. The company had about $248 million of cash and $1.9 billion of net debt, and will prioritize completing key projects, maintaining discipline, and generating cash to reduce debt. Q: How are the company's AI and operational initiatives translating into financial results?A: CEO Geoffrey Gilmore highlighted AI applied to inventory decisions across the MRO network, giving buyers better visibility to evaluate demand patterns, identify duplicate purchasing, and recommend transfers between facilities, with people retaining final control. He also cited the Monroe, Ohio facility, where the team moved work from a bottleneck press to an underutilized asset, increasing production without additional capital investment. Q: What is the outlook across key end markets such as automotive, construction, agriculture, and heavy truck?A: CEO Geoffrey Gilmore said North American automotive production is expected to be essentially flat versus calendar 2025 and should remain solid through year-end. Construction demand was down, with data centers supportive but broader activity sensitive to rates, while agriculture was a bright spot with a 40% shipment increase and heavy truck and trailer showed signs of stabilizing through share gains and new business wins. For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Image source: The Motley Fool. Wed, Oct. 7, 2026 - Vice President of Corporate Communications and Investor Relations - Melissa Dykstra - President and Chief Executive Officer - Geoffrey Gilmore - Vice President and Chief Financial Officer - Timothy Adams Operator: Thank you. Good morning, and welcome to Worthington Steel's First Quarter Fiscal Year 2027 Earnings Call. After today's prepared remarks, we will host a question-and-answer session. [Operator Instructions] I will now hand the conference over to Melissa Dykstra, Vice President of Corporate Communications and Investor Relations. Melissa, please go ahead. Melissa Dykstra: Thank you, operator. Good morning and welcome to Worthington Steel's First Quarter Fiscal Year 2027 Earnings Call. On our call today we have Geoff Gilmore, Worthington Steel's President and Chief Executive Officer, and Tim Adams, Vice President and Chief Financial Officer. Before we begin, I'd like to remind everyone that certain statements made today are forward-looking within the meaning of the 1995 Private Securities Litigation Reform Act. These statements are subject to risks and uncertainties that could cause actual results to differ materially from those suggested. We issued our earnings release yesterday after the market closed. Please refer to more detail on factors that could cause actual results to differ materially. Unless noted as reported, today's discussion will reference non-GAAP financial measures, which adjust for certain items included in our GAAP results and are presented on a stand-alone basis. You can find definitions of each non-GAAP measure and GAAP to non-GAAP reconciliations within our earnings release. The call is being recorded and a replay will be available later today on worthingtonsteel.com. Now I'll turn it over to Geoff Gilmore. Geoffrey Gilmore: Good morning and thanks for joining us. Today marks another major milestone for Worthington Steel as we report Kloeckner Metals as part of our results for the first time. This achievement follows several important steps over the last few months. We closed the transaction on June 3. Kloeckner's shares were delisted from the Frankfurt Stock Exchange on August 12, and the Domination and Profit and Loss Transfer Agreement, or DPLTA, was signed on September 8. The DPLTA remains subject to shareholder approval in October. If approved and effective, it would provide a clear framework for operating control, as well as formal integration and synergy capture, beginning in the first quarter of calendar year 2027. Planning for that phase is already underway on our side. Teams from Worthington Steel and Kloeckner are spending time together, learning each other's business, processes, and cultures. The better we understand each other now, the better prepared we will be to move with discipline when we have operational control. These early interactions continue to reinforce what we believed when we announced the transaction. These are two strong companies with talented people, deep customer relationships, and cultures that value performance. We have more work ahead, but we are encouraged by the foundation we are building. Before I move to our results and end markets, I want to take time to thank our team. In addition to the work happening to ensure the successful integration with Kloeckner, they've been navigating difficult market conditions. Simply put, this is one of the most challenging steel supply environments most of us have ever seen. Supply remains tight, lead times are long, production schedules are shifting, and securing the right material for customers has been difficult. Through it all, our employees continue to shine in their unwavering commitment to our customers and our company. With that, let's turn to the quarter. Net sales were $2.7 billion. Adjusted EBITDA was $111 million, and adjusted earnings per share was $0.57. Because this is the first quarter that includes Kloeckner and their reported results, I will spend a bit more time on the financial details including leverage, purchase accounting, and the items investors should consider when comparing results to prior periods. From my perspective, the bigger point is straightforward. Kloeckner changes the size, shape, and reach of our company. It expands our product and processing capabilities, broadens the markets we serve, and extends our geographic footprint. This is the kind of high-quality scale we have talked about for some time. This scale gives us more ways to serve customers, more balance across cycles, and more opportunities to create long-term value. From a macro standpoint, the quarter remained dynamic. Demand was uneven across end markets, and customers continued to be careful with inventories and commitments. Supply also remained tight in the U.S. with imports down and lead times extended in many parts of the market. In an environment like this, execution makes a real difference. Across the business, our teams work constructively with customers and supply partners, adjusted plans, and help customers secure the material they needed. This is one of the ways Worthington Steel earns trust. Customers need communication, problem solving, and a team that stays engaged when conditions are difficult. That has always been part of who we are and it will remain a strength as we operate as a larger company. Let me walk through what we saw across our key markets, comparing legacy Worthington Steel for both periods and what we were watching in the months ahead. North American automotive production has remained resilient so far in calendar year 2026, and we expect that to continue through year end. Based on the latest industry forecast, North American production is expected to be essentially flat compared to calendar year 2025. Regardless of the overall build environment, our commercial and technical teams continue to win new business by helping customers solve challenges, support key programs, and develop new products. Our teams really shine in this sector. One example from the quarter was TWB, our joint venture, being recognized with two supplier awards from Subaru. It reflects strong execution, expertise and the customer focus that helps us build long-term relationships. Congratulations to the entire TWB team. Overall, we remain optimistic that automotive will remain solid through the end of calendar year 2026. We are not assuming a significant near-term inflection in builds, but we believe Worthington Steel is well positioned to grow through targeted customer wins, technical solutions, and longer-term localization and near-shoring trends. Demand in the construction market was down in the first quarter. Residential construction continues to support demand, but broader construction activity remains more sensitive to interest rates and consumer confidence. We are also watching interest rates and broader geopolitical stability closely. The recent Fed action reinforces that rates may remain a headwind for longer than many expected, particularly in markets tied to construction, equipment purchases, and larger capital decisions. At the same time, the economy continues to show resilience. And we believe demand can improve as inflation moderates, uncertainty eases, and consumers gain more confidence in the rate environment. So our posture is practical. We're not counting on a quick macro tailwind, but we are staying close to customers, managing what we can control, and positioning the business to respond as conditions improve. Agriculture was a bright spot this quarter with a 40% year-over-year increase in shipments that was mostly driven by the OEM and grain bin markets. We have strong customer relationships in this space and we are staying focused on where we can add value. We will remain disciplined while positioning the business to benefit if demand continues to improve. Heavy truck and trailer continue to show signs of stabilizing. The market started slowly in calendar year 2026, but we saw benefits from share gains and new business wins. We would not characterize the market as fully recovered, but the direction is more constructive than it was earlier in the year. For us, the priority is readiness. We will manage the current environment carefully and stay prepared to capture opportunities as activity strengthens. As we bring Kloeckner into our reported results, our market discussion will also evolve. We will continue to talk about the end markets investors know well for Worthington Steel, including automotive, construction, agriculture, and heavy truck and trailer. Over time, we also expect to add more perspective on other industrial sectors where Kloeckner has meaningful exposure. Turning to strategic priorities, Kloeckner is clearly at the top of the list. We are focused on preparing for integration. That means learning the businesses, reviewing processes, and building relationships while protecting customer service and respecting the strengths of both organizations. We want to move with discipline, not just speed. We want to capture value, but we want to do it thoughtfully and with the same operating discipline that has guided Worthington Steel for decades. We continue to believe in the long-term demand drivers tied to electrification, grid investment, and higher efficiency applications. We are taking a disciplined view of the business under current market conditions and we remain focused on improving performance and building value from the capabilities we have developed. We also continue to find practical ways to make the business better. Some of that comes through technology and AI, and some of it comes from disciplined problem solving by our teams. Regardless of the technology involved, our approach is consistent. Simplify the work, improve the process, where it makes sense and apply AI to enhance decision-making. In indirect purchasing, for example, we've been simplifying workflows, reducing manual effort, and giving our buyers better information to make decisions. Last year, that work allowed buyers to spend more time on supplier negotiations, sourcing strategy, and commodity management. This led to significant cost avoidance across the company. This year, we built on that foundation by applying AI to improve inventory decisions across our maintenance, repair, and operations network. Our buyers now have better visibility across the enterprise. While AI helps evaluate demand patterns, identify duplicate purchasing opportunities, recommend transfers between facilities, and support inventory-level decisions. Importantly, our people remain in control, but they have a new tool to help make better decisions. Buyers and maintenance teams confirm recommendations before decisions are made, avoiding unnecessary purchases. We have identified and validated the value. Now the work is converting that into financial results over time to disciplined operating reviews and better inventory management. Longer term, we also see this as a capability that can scale across a larger footprint as we move through Kloeckner integration. Another good example is our Monroe, Ohio facility where the team unlocked capacity by taking a fresh look at how work was being done. Through disciplined problem solving, internal engineering expertise, and better use of existing assets, the team identified work that could move from a bottleneck press to a previously underutilized asset. By thinking differently, the team increased production using in-house capabilities, allowing us to better support customer demand without additional capital investment. Together, these examples show how we are creating value in complementary ways. Through digital transformation and AI-enabled decision-making, and through operational excellence led by the experience and problem-solving capabilities of our people. Before I close, I want to come back to my earlier comments about the challenging market we are operating in today. It takes relationships, experience, persistence, and innovative thinking to serve customers well in this kind of environment. Our employees continue to excel in this area. Ultimately, this is what sets us apart in the industry. While managing through tough market conditions, Worthington Steel teams also continued preparing for the next phase of the Kloeckner transaction. I appreciate the focus, discipline, and commitment from everyone at Worthington Steel. So to our commercial purchasing supply chain and teams who work with customers and supply partners to keep material moving, thank you. You are helping customers navigate a difficult supply environment. We appreciate your efforts and so do I. To the teams preparing for Kloeckner integration, thank you. The learning and relationship building underway will help shape our future. And to our Kloeckner colleagues, we are glad to be moving forward together. We are still early in this process, but we are excited about the company we are building. Worthington Steel is larger, broader, and more diversified than it was a year ago. We have meaningful work ahead and we will approach it the way we always do. With discipline, care for our people, commitment to customers, and a focus on long-term value creation. With that, I'll turn the call over to Tim for more detail on the quarter and the financials. Timothy Adams: Thank you, Geoff, and good morning, everyone. Our first quarter results include 100% of Kloeckner following the June 3 acquisition. I will begin with our consolidated results and the items affecting comparability and then discuss the legacy Worthington Steel business where year-over-year comparisons are meaningful. I will finish with cash flow, capital spending, and our balance sheet. The earnings figures I will discuss are from continuing operations. Discontinued operations primarily reflect the results of Becker Stahl, which Kloeckner is marketing for sale. In the first quarter, we reported a net loss from continuing operations attributable to Worthington Steel of $7 million, or $0.14 per diluted share. This compares with net earnings of $36.8 million, or $0.73 per diluted share, in the prior year quarter. The reported results included several items affecting comparability. The largest were $22.6 million of pre-tax acquisition-related expenses, a $15.5 million pre-tax loss from re-measuring our previously held Kloeckner shares at closing, a $5.6 million deferred tax asset write-off related to the Kloeckner acquisition. These and the other adjustments for both periods are detailed in our earnings release. Excluding these items, adjusted earnings were $0.57 per diluted share compared with $0.77 in the prior year quarter. Adjusted EBIT was $78.5 million, up $23 million from the prior year quarter. While adjusted EBIT increased, higher interest expense following the acquisition weighed on adjusted earnings per share. Net interest expense was $38.8 million compared with $2.9 million a year ago. Adjusted EBITDA was $111 million. Beginning this quarter, our measure includes 100% of the adjusted EBITDA of our consolidated operations before allocation to non-controlling interest. We believe this change enhances comparability to our balance sheet measures. Earnings per share continues to reflect earnings attributable to Worthington Steel shareholders. There's one additional item that is important to understanding our results for the current quarter. Purchase accounting required us to record Kloeckner's acquired inventory at fair value. As that inventory was sold, the step-up reduced first quarter gross margin and adjusted EBITDA by an estimated $43 million. We expect only a limited residual impact in the second quarter. Net sales in the quarter were $2.7 billion, up approximately $1.9 billion from the prior year quarter, primarily due to the addition of Kloeckner. Total shipments were approximately 1.9 million tons, a consolidated mix with 77% direct sale and 23% toll processing, compared with 63% direct sales and 37% toll processing a year ago. Turning to Legacy Worthington Steel, net sales were $954 million, up $81 million or 9% from the prior year quarter. The increase reflected higher direct volumes and selling prices. Total legacy shipments were approximately 921,000 tons, down 1% year-over-year. Direct sale volumes increased 3% while toll volumes declined 8%. As Geoff discussed, automotive remained a bright spot. Our direct shipments to automotive increased 4% year-over-year. Agriculture shipments increased 40% supported by OEM equipment and grain bin demand. Shipments to other transportation, which now includes heavy truck, increased 39%, primarily due to share gains as new business was layered in. As a reminder, these are references to legacy markets and do not include the impact of Kloeckner. These gains were substantially offset by lower energy and construction shipments. Energy shipments declined 31%, reflecting a shift in customer sourcing to another supplier. Construction shipments declined 9%, reflecting increased competition and tight steel availability, which limited our ability to quote short-term contract business. Higher direct volumes increased legacy direct spreads by $7.6 million. In addition, the favorable change in inventory holding gains added $6.5 million. Estimated pre-tax inventory holding gains were $12.1 million this quarter, compared with $5.6 million a year ago. Excluding the effects of volume and inventory holding gains, direct spreads were approximately flat year-over-year. Lower toll volumes reduced legacy toll spreads by $2.3 million. This was partially offset by $1.4 million of improved mix, including spot tolling business at higher spreads. Turning to operating expenses, manufacturing expenses in the legacy business increased approximately $11 million or 6%, primarily due to higher labor, benefits, and freight costs. Legacy SG&A increased $17.6 million, primarily reflecting the addition of acquisition-related expenses. Excluding acquisition-related fees and the prior year's Sitem closing bonus, Legacy SG&A increased $2.9 million, primarily due to wages and benefits. Finally, equity earnings from Serviacero, our Mexico-based joint venture, decreased approximately $1 million due to lower direct volumes, partially offset by improved direct spreads. Hot-rolled coil prices ended the quarter around $1,200 per ton. Mill supply remains tight, and expected mill maintenance outages are likely to keep lead times extended in the near future. Given the lagging index-based pricing mechanisms in many of our contracts, we currently estimate pre-tax inventory holding gains in the legacy Worthington Steel business of $10 million to $15 million in the second quarter of fiscal 2027. Turning to cash flow, consolidated Worthington Steel had operating cash outflow of $6 million for the quarter. Capital expenditures were $63 million, resulting in negative free cash flow of $69 million. The principal factors affecting total cash flow included the Kloeckner acquisition and the issuance of our Term Loan B and senior notes. The capital expenditures in the first quarter were roughly split evenly between Legacy Worthington Steel and Kloeckner. Spending in our legacy business is weighted toward the earlier part of the fiscal year, reflecting the timing of several projects already underway. We expect that spending to moderate as the year progresses, though the first quarter pace should not be viewed as representative of the full year. Our current planning estimate for combined capital expenditures is $160 million to $180 million for fiscal 2027, with the timing of the project spending influencing where we finish within that range. Following the DPLTA effectiveness, we will review capital priorities across the combined business. Our focus remains completing key projects, maintaining operating discipline, and generating cash to reduce debt. At August 31, we had approximately $248 million of cash and $1.9 billion of net debt following the Kloeckner acquisition. We are not reporting a trailing 12-month leverage ratio this quarter because it would include the acquisition financing and all of Kloeckner's debt, but only three months of Kloeckner's EBITDA. We expect to report the ratio once we have a full year of Kloeckner results. Our previously communicated synergy and deleveraging targets remain unchanged. We expect debt reduction to progress alongside synergy capture and working capital improvement. As I mentioned earlier, Becker Stahl is also being marketed for sale and we expect Kloeckner will use the majority of the net proceeds for debt reduction. Our Board also declared a quarterly dividend of $0.16 per share payable on December 28, 2026. To close, our financial priorities are clear. We are focused on completing the DPLTA, which is necessary for us to fully integrate Kloeckner and capture synergies, reducing leverage, and advancing our strategic growth projects. Across the business, we will maintain operating and capital discipline with a focus on generating cash and reducing debt. I want to thank our teams for their continued focus on safety, customer service, and execution. At this point, we would be happy to take your questions. Operator: [Operator Instructions] Your first question comes from the line of Samuel McKinney with KeyBanc Capital Markets. Samuel McKinney: Despite the tight supply environment, Legacy Worthington direct tons were down less than 1% sequentially in the first quarter, much better than normal seasonality. I assume some of that has to do with continued market share wins in auto and heavy trucks, but any more details you guys can share around that volume beat would be helpful. Geoffrey Gilmore: That's a very good performance. And as you said, even more so with the seasonality and Sam, your assumptions, right. It's definitely the market share gains that have continued to grow, you know, be layered in here over time, whether it be heavy truck, agriculture, as well as automotive. And Sam, in fact, we probably missed out on another 30,000 tons of shipment this quarter just due to the supply chain constraints. Samuel McKinney: Okay. And then Galvanized continue to get better. They averaged over $200 in your fiscal first quarter. I mean, that's much better than the long-term average and the trough levels earlier this year. What's your stance on the sustainability of these spreads as hot-rolled pricing continues to rise? Geoffrey Gilmore: You know, I mean, again, today we saw CRU tick up both hot rolled and coated and coated more. And I, we feel pretty strongly that sustainability is an absolute go. I mean, at this point, the market's going to remain tight. You got very limited imports coming in. So the longevity of it is strong. And, you know, for us, we weren't able to experience a lot of that spread expansion here over this quarter. And the reason for that is there's not much spot tonnage available, Sam, as you know. And predominantly, you know, 90% or more of our business is contractual. So we feel pretty strongly on the sustainability piece as we move to this new contract season that would start January 1. And so from that point on is where you would start to see that reflected in our numbers. Samuel McKinney: Okay, got it. Thanks, Geoff. Geoffrey Gilmore: Got it, Sam. Thank you. Operator: Your next question comes from the line of John Tumazos with John Tumazos Very Independent Research. John, your line is now open. Please go ahead. John Tumazos: Thank you very much. Could you explain the details of the German or European law where the 38% minority holders retain their shares and how long they can retain them? And could you explain the difference in inventory turnover and gross margin between the two? Between the Kloeckner and Worthington legacy businesses. Geoffrey Gilmore: John, I'll take the first part and Tim, please jump in if I miss anything on timeframe. Specifically to that 38% and the minority shareholders. First of all, once the DPLTA is approved by shareholders and declared effective by the German courts, minority shareholders are granted a put option and they could sell their shares to Worthington for EUR 11 per share, which is what we negotiated. Now to your question, should minority shareholders choose to remain? The DPLTA states they would receive an annual guaranteed cash compensation of 6% or EUR 0.66 per share. Specific to the timeline, Tim, I can't remember the exact timeline on how long they can hold their shares. I'm not sure that it's clear that there is, right? So, John, hopefully you heard that. We had a little discussion amongst us. They could hold on to the shares as long as they like. Timothy Adams: John, as far as your second part of the question, as far as gross margins, so this should come as no surprise, gross margins for Worthington Steel will be higher because we have higher value-added processes, including galvanized and pickling. So we make galvanized and Kloeckner buys galvanized. So the starting point is just different. So their margins are going to be a little bit lower than ours, but it's one of the synergies that we pointed out. We'll start making galvanized for them once we're able to capture the synergies. And it's the same thing on the inventory turnovers. I don't have a specific number for you with respect to how they performed in the past, but we've put out $150 million of working capital synergies. So we know a big chunk of that is related to inventory and how we manage the business versus how they manage the business. And it goes back to transformation, right? We've transformed and you can see in the data that we put out there, kind of where we started 15 years ago on inventory days and where we are today, we're looking to put similar improvements at Kloeckner down inventory. Operator: Your next question comes from the line of Martin Englert with Seaport. Martin, your line is open. Please go ahead. Martin Englert: Hello, good morning everyone. Geoffrey Gilmore: Hi, Martin. Martin Englert: I wanted to see, can you give us a clearer view of Kloeckner's normalized EBITDA on Q1, excluding the purchase accounting, the inventory step up that was the previous $43 million fair value, and anything else that might be in there. Also any type of color on how earnings looked across the Kloeckner business in North America and Europe, and footprint, respectively. Timothy Adams: Martin, this is Tim. We're not disclosing at this point any, I'll call it segment type data. We're not at that point in the process of being able to talk about that. And then looking back at the, you know, how they performed in the past, you know, we haven't done a pro forma. There's no pro forma available that's been vetted. So we're just kind of looking at Kloeckner. We're making comments about the legacy business. And then we're explaining Kloeckner, kind of what they add to the business. Martin Englert: Right, but the reported results for the quarter, what you did infer within the release, the $43 million, and this was prepared remarks. The $43 million was purchase accounting. That would be non-cash, correct? And that would be additive to what was reported and it was not adjusted out of the $111 million of EBITDA, correct? Timothy Adams: That is correct. That is correct. When we say adjusted out of, like what I would say it this way. You could add back the $43 million to the $111 million to get to, you know, $150 million that's more representative of EBITDA. Martin Englert: Okay, excellent. Thanks for clarifying that. For the Kloeckner business, this is maybe a little bit more specific to the U.S., but how much did they source from within the U.S. market from domestic mills versus import? Geoffrey Gilmore: Martin, this is Geoff. So Kloeckner and Worthington Steel have very similar strategies. We support our local mills. We buy where we produce. It's going to be 99% of their purchases would have come from domestic mills. So that's certainly something we're excited about, I've talked about the footprint being highly complementary, being us big in the Midwest and then much bigger in the Southeast and pushing Southwest. And that's going to be great for our supplier base as well because, you know, I say we buy, you know, locally. We truly do buy predominantly most of our steels regionally, and we're in the Midwest, and they're in a similar situation. So we'll have jointly new suppliers in the mix. But same strategy as Worthington Steel. Martin Englert: Okay, understood. That's all I have. Thank you very much. Geoffrey Gilmore: Thanks, Martin. Operator: We have reached the end of the Q&A session. I will now turn the call back to Geoff Gilmore, President and CEO, for closing remarks. Geoffrey Gilmore: Thank you and a lot of progress obviously this quarter. Another important milestone coming up. I want to again say how proud I am of the Worthington Steel and Kloeckner employees for their efforts and work to date. And then thank you for listening in and showing interest in Worthington Steel. We look forward to talking again next quarter. Operator: This concludes today's call. Thank you for attending. You may now disconnect. Before you buy stock in Worthington Steel, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Worthington Steel wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $370,440!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $1,470,022!* Now, it's worth noting Stock Advisor's total average return is 955% — a market-crushing outperformance compared to 215% for the S&P 500. Don't miss the latest top 10 list, available with Stock Advisor, and join an investing community built by individual investors for individual investors. See the 10 stocks » *Stock Advisor returns as of October 7, 2026. This article is a transcript of this conference call produced for The Motley Fool. While we strive for our Foolish Best, there may be errors, omissions, or inaccuracies in this transcript. As with all our articles, The Motley Fool does not assume any responsibility for your use of this content, and we strongly encourage you to do your own research, including listening to the call yourself and reading the company's SEC filings. Please see our Terms and Conditions for additional details, including our Obligatory Capitalized Disclaimers of Liability. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. Worthington Steel (WS) Q1 2027 Earnings Call Transcript was originally published by The Motley Fool

Our analysts just identified a stock with the potential to be the next Nvidia. Tell us how you invest and we'll show you why it's our #1 pick. Tap here. - The Kloeckner Metals acquisition significantly alters the company's scale, reach, and product capabilities, providing greater balance across market cycles and a broader geographic footprint. - Management characterized the current steel supply environment as one of the most challenging ever seen, marked by tight supply, long lead times, and shifting production schedules. - Legacy automotive shipments remained resilient, growing 4% year-over-year despite a flat overall build environment, driven by market share gains and new technical solutions. - Agriculture shipments surged 40% due to strong OEM and grain bin demand, while construction shipments fell 9% as high interest rates and tight steel availability limited short-term contract bidding. - The company is leveraging AI and digital transformation to optimize indirect purchasing and inventory management, aiming to scale these efficiencies across the larger Kloeckner footprint. - Operational excellence initiatives at the Monroe, Ohio facility successfully unlocked capacity by reallocating work to underutilized assets, avoiding the need for new capital investment. - Formal integration and synergy capture are expected to begin in the first quarter of calendar year 2027, contingent on the approval of the Domination and Profit and Loss Transfer Agreement (DPLTA). - Management expects automotive production to remain solid through the end of calendar year 2026, though they are not assuming a significant near-term inflection in builds. - Fiscal 2027 capital expenditures are projected between $160 million and $180 million, with spending expected to moderate following a front-loaded first quarter. - The company maintains its previously communicated synergy and deleveraging targets, with debt reduction prioritized alongside working capital improvements and the potential sale of Becker Stahl. - Inventory holding gains for the legacy business are estimated at $10 million to $15 million for the second quarter of fiscal 2027, based on current lagging index-based pricing mechanisms. - First quarter results were impacted by a $43 million non-cash inventory step-up charge related to purchase accounting for Kloeckner, which reduced reported gross margin and adjusted EBITDA. - Reported net loss included $22.6 million in pre-tax acquisition expenses and a $15.5 million loss from re-measuring previously held Kloeckner shares. - Interest expense rose sharply to $38.8 million from $2.9 million in the prior year, reflecting the new debt structure following the acquisition. - The company is marketing Becker Stahl for sale, with Kloeckner expected to use the majority of net proceeds for debt reduction. One stock. Nvidia-level potential. 30M+ investors trust Moby to find it first. Get the pick. Tap here. - Management attributed the resilient volume performance to market share gains in heavy truck, agriculture, and automotive sectors. - Geoff Gilmore noted that supply chain constraints likely prevented an additional 30,000 tons of shipments during the quarter. - Management believes tight market conditions and limited imports support the sustainability of current higher spreads. - The financial benefit of these spreads is expected to be more visible starting January 1, as the company moves into the new contract season. - Under the DPLTA, minority shareholders can sell their shares for EUR 11 or remain and receive a guaranteed annual cash compensation of 6% (EUR 0.66 per share). - Kloeckner currently has lower gross margins than legacy Worthington because they buy galvanized steel rather than producing it; management plans to capture synergies by producing galvanized steel for Kloeckner internally. - Tim Adams clarified that adding back the $43 million purchase accounting charge would result in a more representative adjusted EBITDA of approximately $150 million. - Kloeckner follows a similar domestic sourcing strategy to Worthington, with approximately 99% of purchases coming from domestic mills in their respective regions.

- Interested in Worthington Steel, Inc.? Here are five stocks we like better. - Worthington Steel reported mixed fiscal Q1 2027 results after including Kloeckner for the first time, with $2.7 billion in sales and $111 million in adjusted EBITDA. Reported results included significant acquisition-related charges, while Kloeckner purchase accounting reduced adjusted EBITDA by approximately $43 million. - The legacy business benefited from stronger automotive, agriculture and heavy-truck shipments, but energy and construction volumes declined. Management cited tight steel supply, limited imports and extended lead times as support for steel spreads and future pricing. - Cash flow was pressured by the acquisition and investment spending, with $69 million of negative free cash flow and $1.9 billion of net debt at quarter-end. Management maintained its synergy and deleveraging targets, with potential proceeds from the sale of Becker Stahl-Service earmarked primarily for debt reduction. - Arhaus Has New Momentum—Could Other Furniture Stocks Be Next? Worthington Steel (NYSE:WS) reported first-quarter fiscal 2027 results that included Kloeckner for the first time following the June 3 acquisition, as management highlighted progress toward integrating the German metals distributor and processor amid a tight steel supply environment. The company reported net sales of $2.7 billion, adjusted EBITDA of $111 million and adjusted earnings of $0.57 per diluted share. On a reported basis, Worthington Steel recorded a net loss from continuing operations attributable to shareholders of $7 million, or $0.14 per diluted share, compared with earnings of $36.8 million, or $0.73 per diluted share, a year earlier. → 5 Oversold Corners of the Market That Could Bounce If Breadth Finally Improves - 3 Retail Stocks to Watch After a Big Consumer Earnings Week Chief Financial Officer Tim Adams said reported results included $22.6 million of pretax acquisition-related expenses, a $15.5 million pretax loss from remeasuring previously held Kloeckner shares at closing, and a $5.6 million deferred-tax-asset write-off connected to the acquisition. Adjusted earnings per share declined from $0.77 in the prior-year quarter, while adjusted EBIT rose $23 million year over year to $78.5 million. Adams said purchase accounting required Worthington Steel to record Kloeckner inventory at fair value. As that inventory was sold, the resulting step-up reduced first-quarter gross margin and adjusted EBITDA by an estimated $43 million. The company expects only a limited residual effect in the second quarter. → First Citizens BancShares vs MP Materials: A Tale of 2 Regulation Bets - MarketBeat Week in Review – 08/24 - 08/28 During the question-and-answer session, Adams said adding the purchase-accounting impact back to the reported $111 million of adjusted EBITDA would result in roughly $150 million that was more representative of EBITDA for the period. Kloeckner's shares were delisted from the Frankfurt Stock Exchange on Aug. 12, and a Domination and Profit and Loss Transfer Agreement was signed Sept. 8. The agreement remains subject to shareholder approval in October. If approved and declared effective by German courts, the agreement would give Worthington Steel a framework for operating control, formal integration and synergy capture beginning in the first quarter of calendar 2027. → Insiders Are Selling These 3 Stocks, Should You? CEO Geoff Gilmore said teams from both businesses are already working together to understand each other's operations, processes and cultures. "We want to move with discipline, not just speed," Gilmore said. Under the agreement, minority shareholders would be able to sell their Kloeckner shares to Worthington Steel for EUR 11 per share. Shareholders that retain their shares would receive annual guaranteed cash compensation of 6%, or EUR 0.66 per share, Gilmore said. Adams added that minority shareholders could retain their shares indefinitely if they choose. For the legacy Worthington Steel business, quarterly net sales rose 9% year over year to $954 million, reflecting higher direct-sale volumes and selling prices. Total legacy shipments were about 921,000 tons, down 1% from the prior-year period. Direct-sale volume increased 3%, while toll-processing volume declined 8%. Automotive remained a favorable market, with direct shipments to the sector rising 4% year over year. Agriculture shipments increased 40%, supported by OEM equipment and grain-bin demand. Other transportation shipments, which now include heavy truck, rose 39%, largely due to market-share gains and new business. Those gains were partly offset by a 31% decline in energy shipments, which the company attributed to a customer shifting sourcing to another supplier. Construction shipments fell 9%, reflecting increased competition and tight steel availability that limited Worthington Steel's ability to quote short-term contract business. Gilmore said North American automotive production has remained resilient in calendar 2026 and is expected to be essentially flat with 2025 through year-end. He said the company expects to grow through customer wins, technical solutions and longer-term localization and nearshoring trends rather than a major near-term increase in vehicle builds. Construction demand declined during the quarter, though data-center construction continued to support activity. Gilmore said broader construction markets remained sensitive to interest rates and consumer confidence. Heavy truck and trailer markets showed signs of stabilizing after a slow start to calendar 2026, with Worthington Steel benefiting from new business and share gains. Gilmore described the current steel environment as among the most challenging supply conditions the company has faced, citing tight supply, long lead times, changing production schedules and difficulty securing material for customers. Imports have declined, while expected mill maintenance outages are likely to keep lead times extended, Adams said. Hot-rolled coil prices ended the quarter at about $1,200 per ton. Worthington Steel estimated pretax inventory holding gains in its legacy business of $12.1 million during the first quarter, compared with $5.6 million a year earlier. It expects $10 million to $15 million of pretax inventory holding gains in the second quarter. Gilmore said the company expects coated-steel spread conditions to remain sustainable as imports remain limited and markets stay tight. However, he noted that more than 90% of Worthington Steel's business is contractual, limiting the immediate benefit from spot-market pricing. He said improved pricing would be more likely to appear as new contracts begin Jan. 1. Worthington Steel reported operating cash outflow of $6 million and capital expenditures of $63 million, resulting in negative free cash flow of $69 million for the quarter. The company expects combined fiscal 2027 capital expenditures of $160 million to $180 million, with spending expected to moderate later in the year. As of Aug. 31, Worthington Steel had approximately $248 million of cash and $1.9 billion of net debt following the Kloeckner acquisition. The company did not report a trailing 12-month leverage ratio because the calculation would include acquisition financing and Kloeckner debt but only three months of Kloeckner EBITDA. Management said previously communicated synergy and deleveraging targets remain unchanged. Kloeckner is also marketing Becker Stahl-Service for sale, and Adams said Kloeckner expects to use the majority of net proceeds for debt reduction. Worthington Steel's board declared a quarterly dividend of $0.16 per share, payable Dec. 28, 2026. Worthington Steel, Inc is a steel processing company that produces value-added flat-rolled steel products for manufacturers in the automotive, construction, energy, industrial and consumer markets. Its offerings include electrical steel, laser-welded and tailor-welded blanks, and other processed steel products designed to meet specific customer requirements. The company provides services such as slitting, blanking, cold reduction, welding and other steel processing capabilities. Its products are used in applications including automotive components, electrical motors and transformers, building products, pressure vessels and industrial equipment. Worthington Steel was separated from Worthington Industries as an independent public company in December 2023. This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected]. The article "Worthington Steel Q1 Earnings Call Highlights" was originally published by MarketBeat. View MarketBeat's top stocks for October 2026.

Investing.com -- Worthington Steel, Inc. (NYSE: WS) reported first-quarter fiscal 2027 results that fell short of analyst expectations, with shares declining 1.5% after hours on Wednesday following the announcement. Before you buy NVIDIA: our AI model's stock picks are beating the market by 120%+. See the list now » The metals processing company posted adjusted earnings per share of $0.57 for the quarter ended August 31, 2026, missing the analyst consensus of $0.68 by $0.11. Revenue surged 212% YoY to $2.73 billion from $872.9 million, driven primarily by the inclusion of Kloeckner & Co following the company's majority acquisition completed on June 3, 2026. Kloeckner contributed $1.77 billion to net sales in the quarter. The stock moved modestly lower on the earnings miss, though the decline was relatively contained. Not finding the right stocks? Our AI's list of investor-grade stock picks for October just dropped » Excluding Kloeckner's impact, revenue increased 9% compared to the prior year quarter, driven by higher direct volumes and improved pricing. Direct tons sold increased 3% while direct selling prices rose 6%. Adjusted EBIT reached $78.5 million, up from $55.5 million in the prior year quarter. However, the company reported a net loss attributable to controlling interest of $7.0 million, or -$0.14 per diluted share, compared to net earnings of $36.8 million, or $0.73 per share, in the prior year quarter. The loss was impacted by approximately $43 million in inventory fair value step-up costs related to the Kloeckner acquisition. "This quarter marks an important milestone for Worthington Steel as we report our first results including Kloeckner," said Geoff Gilmore, president and CEO. "The addition of Kloeckner significantly expands our capabilities and positions us as a more diversified metals processing and manufacturing company." The company ended the quarter with total debt of $2.20 billion and cash of $248.2 million, resulting in net debt of $1.95 billion. Free cash flow was negative $69.0 million compared to negative $35.7 million in the prior year quarter. Worthington Steel declared a quarterly dividend of $0.16 per share, payable December 28, 2026. Original Article Worthington Steel falls short on Q1 earnings estimates, shares edge lower Constellation Brands stock falls as FY27 guidance disappoints Neogen stock up 8% on better-than-expected Q1 results, guidance

Includes financial results from Kloeckner & Co following majority acquisition COLUMBUS, Ohio, October 06, 2026--(BUSINESS WIRE)--Worthington Steel, Inc. (NYSE: WS), a market-leading, value-added metals processing company, today reported financial results for the fiscal 2027 first quarter ended August 31, 2026. Except as otherwise noted, reported results reflect the impact of the Company's acquisition of a majority interest in Klöckner & Co SE ("Kloeckner"). First Quarter Highlights (all comparisons to the first quarter of fiscal 2026 on a continuing operations basis unless otherwise indicated): - Net sales of $2,726.6 million increased 212% compared to $872.9 million. - Operating income of $56.0 million compared to $48.3 million. - Net loss attributable to controlling interest of $7.0 million compared to net earnings of $36.8 million in the prior year quarter. - Diluted loss per share attributable to controlling interest ("Diluted EPS – Continuing Operations") of $0.14, compared with Diluted EPS – Continuing Operations of $0.73 in the prior year quarter. Adjusted Diluted EPS – Continuing Operations per share of $0.57 compared to $0.77 in the prior year quarter. - Adjusted EBIT of $78.5 million compared to $55.5 million. - On June 3, 2026, subsequent to the end of fiscal 2026, the Company completed settlement of the offer and its acquisition of a majority interest in Kloeckner, securing approximately 62% of Kloeckner's outstanding shares (the "Kloeckner Acquisition"), representing a significant milestone toward eventual operating control and value capture. - On July 15, 2026, the Company commenced a public delisting tender offer for all outstanding Kloeckner shares not already held by the Company at a price of €11.00 per share. On August 12, 2026, the acceptance period ended and Kloeckner's shares were delisted from the regulated market of the Frankfurt Stock Exchange at market closing. Upon settlement of the delisting tender offer, the Company acquired additional Kloeckner shares, increasing the ownership interest to approximately 62.11%. - On September 8, 2026, subsequent to the end of the first quarter of fiscal 2027, the Company entered into a Domination and Profit and Loss Transfer Agreement ("DPLTA") with Kloeckner. Effectiveness of the DPLTA remains subject to the required shareholder approvals and registration with the commercial register at Kloeckner's registered seat and cannot occur before January 1, 2027. - Declared a quarterly dividend of $0.16 per share payable on December 28, 2026, to shareholders of record at the close of business on December 14, 2026. "This quarter marks an important milestone for Worthington Steel as we report our first results including Kloeckner," said Geoff Gilmore, president and CEO. "The addition of Kloeckner significantly expands our capabilities and positions us as a more diversified metals processing and manufacturing company. At the same time, our core Worthington Steel business delivered solid operating performance, driven by higher direct volumes and improved pricing. As we move forward, our priorities remain clear: serving our customers, improving our operations and creating long-term value for our shareholders." Financial highlights for the fiscal 2027 and comparative periods are as follows:(In millions, except volume) | | 1Q 2027 | | | 1Q 2026 | Volume (tons) | | | 1,943,340 | | | | 928,866 | | | | | | | Net sales | | $ | 2,726.6 | | | $ | 872.9 | Operating income | | | 56.0 | | | | 48.3 | Net earnings (loss) from continuing operations attributable to controlling interest | | | (7.0 | ) | | | 36.8 | Adjusted EBIT (Non-GAAP)(1) | | | 78.5 | | | | 55.5 | Adjusted EBITDA (Non-GAAP)(1) | | | 111.0 | | | | 78.8 | Equity in net income of unconsolidated affiliate | | | 5.3 | | | | 6.4 | (Per diluted share amounts, after-tax) | | | | | | | | 1Q 2027 | | | 1Q 2026 | Diluted EPS – Continuing Operations | | $ | (0.14 | ) | | $ | 0.73 | Restructuring and other (income), net | | | (0.03 | ) | | | (0.01 | ) Kloeckner purchase derivative | | | 0.01 | | | | - | Kloeckner acquisition-related expenses | | | 0.37 | | | | - | Kloeckner securities investment loss, net | | | 0.24 | | | | - | Debt issuance cost write-off | | | 0.02 | | | | - | Pension adjustments | | | (0.01 | ) | | | - | Sitem Group acquisition completion bonus payment | | | - | | | | 0.03 | Deferred tax asset adjustment | | | 0.11 | | | | 0.02 | Adjusted Diluted EPS – Continuing Operations (Non-GAAP)(1) | | $ | 0.57 | | | $ | 0.77 | | | Three Months Ended | | | Three Months Ended | | | August 31, 2026 | | | August 31, 2025 | | | Consolidated | | | Legacy Worthington Steel (2) | | | Consolidated | Volume (tons) - Total | | | 1,943,340 | | | | 921,234 | | | | 928,866 | Volume (tons) - Direct | | | 1,501,949 | | | | 604,289 | | | | 585,073 | Volume (tons) - Toll | | | 441,391 | | | | 316,945 | | | | 343,793 | Net Sales | | $ | 2,726.6 | | | $ | 953.9 | | | $ | 872.9 | EBIT (Non-GAAP)(1) | | | 43.9 | | | | 15.7 | | | | 53.1 | Adjusted EBITDA (Non-GAAP)(1) | | | 111.0 | | | | 75.1 | | | | 78.8 | _____________________________________________ | (1) | | Results in both the current year period and prior year period were impacted by certain items, as further discussed and reconciled to the most directly comparable GAAP financial measure in the Use of Non-GAAP Financial Measures and Definitions section later in this release. | (2) | | Results exclude the impact of the intercompany activity between Legacy Worthington Steel and Kloeckner that is eliminated in consolidation. Kloeckner Acquisition On June 3, 2026, the Company completed the Kloeckner Acquisition in which it acquired a controlling equity stake. Kloeckner's results are included in the consolidated financial statements beginning on the acquisition date, with the portion of Kloeckner not owned by the Company reflected as noncontrolling interests. Following the transformational acquisition of Kloeckner and the related acquisition financing, the Company has updated the adjusted EBITDA metric to include the full adjusted EBITDA of our consolidated operations, including noncontrolling interests, to better reflect the economics of our consolidated business. As a result, adjusted EBITDA amounts for prior year periods have been recast, as applicable to conform to this presentation. In connection with the Kloeckner Acquisition, the Company acquired certain Kloeckner business units that met the held-for-sale criteria as of the acquisition date (the "Disposal Group"). Kloeckner management has committed to a plan to sell the Disposal Group, and the Company expects the sale to be completed within one year of the Kloeckner Acquisition. The results of this Disposal Group are reported as discontinued operations in the accompanying interim consolidated financial statements for all periods in fiscal 2027 and onward. Unless otherwise indicated, the discussion and analysis of our results of operations included in this release relates to continuing operations and excludes the results of discontinued operations. Prior-period amounts have been recast, as applicable, to conform to this presentation. Consolidated Quarterly Results Net sales and volume Net sales for the first quarter of fiscal 2027 were $2,726.6 million, an increase of $1,853.7 million, or 212%, compared to the prior year quarter. Kloeckner contributed $1,772.7 million to net sales in the first quarter of fiscal 2027. Excluding the impact of Kloeckner, net sales increased $81.0 million or 9% compared to the prior year quarter. This $81.0 million increase was driven primarily by higher direct volumes, and, to a lesser extent, higher average direct selling prices. Direct net sales increased $81.7 million. Direct tons sold increased by 3% and direct selling prices increased 6% in the first quarter of fiscal 2027 compared to the prior year quarter. Toll processing net sales decreased $0.7 million, or 2%, in the first quarter of fiscal 2027 compared to the prior year quarter. Toll volumes decreased 8% and toll selling prices increased 6% in the first quarter of fiscal 2027 compared to the prior year quarter. The consolidated mix of direct tons versus toll tons processed was 77% to 23% in the first quarter of fiscal 2027 compared to 63% to 37% in the prior year quarter. Excluding the impact of Kloeckner, the mix of direct tons versus toll tons processed was 66% to 34% in the first quarter of fiscal 2027 compared to 63% to 37% in the prior year quarter. Gross margin Gross margin in the first quarter of fiscal 2027 was $261.2 million, an increase of $146.0 million compared to the prior year quarter. The Kloeckner Acquisition contributed $144.0 million to gross margin in the first quarter of fiscal 2027. The gross margin attributable to Kloeckner was impacted due to an approximately $43 million net inventory fair value step-up recognized in connection with the acquisition of Kloeckner. Excluding the impact of Kloeckner, gross margin increased $2.0 million compared to the prior year quarter. The increase was primarily driven by higher direct spreads (calculated as sales less material costs), partially offset by higher manufacturing expenses and lower toll spreads. Direct spreads increased by $13.9 million primarily due to the $7.6 million impact of higher direct volumes, and to a lesser extent, the $6.5 million favorable change from an estimated $5.6 million inventory holding gain in the prior year quarter to an estimated $12.1 million inventory holding gain in the first quarter of fiscal 2027. This was partially offset by a $0.2 million unfavorable direct spread impact from pricing. Toll spreads decreased $0.9 million. Manufacturing expenses increased $11.1 million, primarily related to increased wages and benefits. Operating Income Operating income in the first quarter of fiscal 2027 was $56.0 million, an increase of $7.7 million compared to the prior year quarter. The Kloeckner Acquisition increased operating income by $24.2 million in the first quarter of fiscal 2027. Excluding the impact of Kloeckner, operating income decreased by $16.5 million compared to the prior year quarter. The decrease was driven primarily by a $17.6 million increase in selling, general and administrative expense ("SG&A") and a $1.0 million unfavorable change in restructuring and other (income), expense, net, partially offset by a $2.0 million increase in gross margin. The $17.6 million increase in SG&A was primarily attributable to an increase of $18.6 million in professional fees. This increase in professional fees incurred by Legacy Worthington Steel was primarily related to the Kloeckner Acquisition. The prior year restructuring and other (income), net represents a gain on the sale of an asset related to the previously announced closure of Worthington Samuel Coil Processing's toll processing facility in Cleveland, Ohio. During the first quarter of fiscal 2027, Kloeckner recognized a gain of $3.6 million in restructuring and other (income), expense, net, due to various restructuring programs. These items included early retirement and severance costs, facility exit and other costs, and sales of fixed assets in Louisiana and Switzerland. Net earnings (loss) and adjusted net earnings (loss) Net loss from continuing operations attributable to controlling interest of $7.0 million in the first quarter of fiscal 2027 compared with net earnings of $36.8 million in the prior year quarter. Diluted loss per share from continuing operations attributable to controlling interest was $0.14, compared with diluted earnings per share of $0.73 in the prior year quarter. Adjusted net earnings from continuing operations attributable to controlling interest were $29.1 million in the first quarter of fiscal 2027, compared with $38.8 million in the prior year quarter. Adjusted diluted earnings per share were $0.57, compared with $0.77 in the prior year quarter. Certain amounts disclosed within the Company's quarterly results have been adjusted to conform to the current presentation due to the update to estimated tax rates on Non-GAAP adjustments in fiscal 2026. The adjustments had an immaterial impact to the presented results. For additional information on non-GAAP financial measures, see the Use of Non-GAAP Financial Measures and Definitions section later in this release. Balance Sheet, Cash Flow and Capital Allocation As of August 31, 2026, the Company had cash and cash equivalents of $248.2 million. During the first quarter of fiscal 2027, net cash used in operating activities was $6.0 million compared to net cash used in operating activities of $6.3 million in the prior year quarter. Investment in property, plant and equipment during the first quarter of fiscal 2027 was $63.0 million compared to $29.4 million in the prior year quarter. The Company had negative free cash flow (as defined in the Use of Non-GAAP Financial Measures and Definitions section later in this release) of $69.0 million in the first quarter of fiscal 2027 compared to negative free cash flow of $35.7 million in the prior year quarter. The Company ended the first quarter of fiscal 2027 with total debt of $2,196.4 million and $248.2 million in cash and cash equivalents, resulting in a net debt (as defined in the Use of Non-GAAP Financial Measures and Definitions section later in this release) position of $1,948.2 million. The Company's board of directors declared a quarterly dividend of $0.16 per common share. The dividend is payable on December 28, 2026, to shareholders of record at the close of business on December 14, 2026. Conference Call The Company will review fiscal 2027 first quarter results during its quarterly conference call on October 7, 2026, beginning at 8:30 a.m., Eastern Time. Conference call details are available through Events & Presentations in the Investors section of the Company's website at WorthingtonSteel.com, or by registering online at https://events.q4inc.com/attendee/682402066 for the live conference. About Worthington Steel Worthington Steel (NYSE: WS) is one of North America's leading value-added metals processing and manufacturing companies. The Company partners with customers to deliver specialized, highly technical solutions across carbon flat-rolled steel, aluminum, stainless steel, long products, heavy plate and electrical steel, to solve complex challenges across a broad range of industries. Worthington Steel employs approximately 12,000 people and operates approximately 150 facilities, primarily in North America, with additional operations in Europe and Asia. The Company combines extensive processing expertise with advanced manufacturing technologies, including galvanizing, pickling, configured blanking, specialty cold reduction, electrical steel laminations, fabrication and precision processing. Guided by its people-first Philosophy and a commitment to safety, innovation and continuous improvement, Worthington Steel creates long-term value by delivering trusted solutions for customers, opportunities for employees, returns for shareholders and strength for the communities where it operates. Important Information: On September 8, 2026, Worthington Steel and Kloeckner & Co entered into a DPLTA, which remains subject to approval by Kloeckner shareholders and the registration with the competent commercial register before becoming effective. Until the DPLTA becomes effective, Kloeckner continues to operate independently. The employee and facility counts above reflect the expected combined organization following the DPLTA becoming effective. Safe Harbor Statement Selected statements contained in this release constitute "forward-looking statements," as that term is used in the Private Securities Litigation Reform Act of 1995 (the "Act"). The Company wishes to take advantage of the safe harbor provisions included in the Act. Forward-looking statements reflect the Company's current expectations, estimates or projections concerning future results or events. These statements are often identified by the use of forward-looking words or phrases such as "believe," "expect," "anticipate," "may," "could," "should," "would," "intend," "plan," "will," "likely," "estimate," "project," "position," "strategy," "target," "aim," "seek," "foresee" and similar words or phrases. These forward-looking statements include, without limitation, statements relating to: future or expected cash positions, liquidity and ability to access financial markets and capital; outlook, strategy or business plans; expected financial and operational performance and future opportunities; the tax treatment of the Company's separation from Worthington Enterprises, Inc. (the "Separation"); future or expected growth, growth potential, forward momentum, performance, competitive position, sales, volumes, cash flows, earnings, margins, including the Company's long-term adjusted EBITDA margin target, balance sheet strengths, debt, financial condition or other financial measures; pricing trends for raw materials and finished goods and the impact of pricing changes; the ability to improve or maintain margins; expected demand or demand trends; industry and market forecasts and expected trends relating to electricity usage, data center growth, vehicle electrification, decarbonization, infrastructure investment and electric-grid modernization and expansion; additions to product lines and opportunities to participate in new markets; expected benefits from transformation, innovation, artificial intelligence, machine learning and other technology initiatives; the ability to improve performance and competitive position at the Company's operations; anticipated working capital needs, capital expenditures and asset sales; anticipated improvements and efficiencies in costs, operations, sales, inventory management, sourcing, the supply chain and corporate functions and the results thereof; projected profitability potential; capital allocation priorities, including the payment of dividends and opportunistic share repurchases; the ability to make acquisitions, form joint ventures and consolidate operations, and the projected timing, results, benefits, costs, charges and expenditures related to acquisitions, joint ventures, headcount reductions and facility dispositions, shutdowns and consolidations; the Company's plans and objectives related to its acquisition of Kloeckner, including the Company's path to eventual operating control of Kloeckner and expected value capture, anticipated cost, operating, commercial, revenue and working capital synergies, integration plans, and the anticipated effects on the Company's market position, geographic footprint, product and service offerings, earnings and margins; the Company's expected pro forma net leverage ratio and deleveraging goals following the Kloeckner Acquisition; the DPLTA, including the approval, timing and effectiveness of the DPLTA and the anticipated combination and integration of the Company and Kloeckner; projected capacity and the alignment of operations with demand; the ability to operate profitably and generate cash in down markets; the ability to capture and maintain market share and to develop or take advantage of future opportunities, customer initiatives, new businesses, new products and new markets; expectations for Company and customer inventories, jobs and orders; expectations for the economy and markets or improvements therein; expectations for generating improving and sustainable earnings, earnings potential, margins or shareholder value; effects of judicial rulings, laws and regulations; anticipated improvements in business and efficiencies to be gained from the use of artificial intelligence and machine learning and other technologies; effects of cybersecurity breaches and other disruptions to information technology infrastructure; effects of public health emergencies and the various responses of governmental and nongovernmental authorities thereto on economies and markets and on the Company's customers, counterparties, employees and third-party service providers; and other non-historical matters. Because they are based on beliefs, estimates and assumptions, forward-looking statements are inherently subject to risks and uncertainties that could cause actual results to differ materially from those projected, and forward-looking statements are not guarantees of future performance. Any number of factors could affect actual results, including, without limitation, those that follow: the effect of conditions in national and worldwide financial markets, including inflation, increases in interest rates and economic recession, and the ability of financial institutions to provide capital; the risks, uncertainties and impacts related to public health emergencies, the duration, extent and severity of which are impossible to predict, and actions taken by governmental authorities or others in connection therewith; changing commodity prices and supply; product demand and pricing; changes in product mix, product substitution and market acceptance of the Company's products; changes in or the failure to realize anticipated trends in electricity usage, data center growth, vehicle electrification, decarbonization, infrastructure investment and electric-grid modernization and expansion; the possibility that industry forecasts, market projections and other estimates or assumptions included in this release may prove inaccurate; volatility or fluctuations in the pricing, quality or availability of raw materials, particularly steel, supplies, transportation, utilities, energy, labor and other items required by operations; effects of sourcing and supply chain constraints, including interruptions in deliveries of raw materials and supplies or the loss of key supplier relationships; the outcome of adverse claims experience with respect to workers' compensation, product recalls or product liability, casualty events or other matters; effects of critical equipment failures, facility closures and the consolidation of operations; the effect of financial difficulties, consolidation and other changes within the steel, automotive, construction and other industries in which the Company participates; failure to maintain appropriate levels of inventories; financial difficulties, including bankruptcy filings, of original equipment manufacturers, end-users and customers, suppliers, joint venture partners and others with whom the Company does business; the ability to realize targeted expense reductions from headcount reductions, facility closures and other cost reduction efforts; the ability to realize cost savings and operational, sales and sourcing improvements and efficiencies and other expected benefits from transformation initiatives on a timely basis; the effects of the Kloeckner Acquisition on the Company's and Kloeckner's operations, including their future financial condition and performance, operating results, strategy and plans, anticipated tax treatment, unforeseen liabilities, future capital expenditures, revenues, expenses, earnings, synergies, economic performance, indebtedness, losses, future prospects and business and management strategies; the possibility that anticipated synergies, working capital reductions, cost savings, revenue opportunities, operational improvements, deleveraging, liquidity, integration benefits, margin expansion and other benefits of the Kloeckner Acquisition may not be realized when expected or at all, may be less than anticipated or may cost more to achieve than expected; the time and effort required to integrate the Company's and Kloeckner's businesses and the risk that the businesses may not be integrated successfully or within the expected timeframe; the impact of limited financial flexibility and increased interest expense resulting from the Kloeckner Acquisition; the Company's ongoing financial obligations under the DPLTA to Kloeckner and its minority shareholders; risks associated with litigation or appraisal proceedings relating to the Kloeckner Acquisition or the DPLTA; the adverse impact of failing to continue to retain, recruit and motivate executives and other key employees; the overall success of, and the ability to integrate, newly acquired businesses and joint ventures, maintain and develop their customers, and achieve synergies and other expected benefits and cost savings therefrom; the ability to realize expected benefits of strategically deployed capital expenditures; capacity levels and efficiencies, within facilities, within major product markets and within the industries in which the Company participates as a whole; the effect of disruption in the business of suppliers, customers, facilities and shipping operations due to adverse weather, casualty events, equipment breakdowns, labor shortages, interruption in utility services, civil unrest, international conflicts, terrorist activities or other causes; changes in customer demand, inventories, spending patterns, product choices, and supplier choices; risks associated with doing business internationally, including economic, political and social instability, foreign currency exchange rate exposure and the acceptance of the Company's products in global markets; the effect of national, regional and global economic conditions generally and within major product markets, including significant economic disruptions from public health emergencies, the actions taken in connection therewith and the implementation of related fiscal stimulus packages; the impact of tariffs, the adoption of trade restrictions affecting the Company's products, suppliers or customers, a United States withdrawal from or significant renegotiation of trade agreements, the occurrence of trade wars, the closing of border crossings and other changes in trade regulations or relationships; the ability to improve and maintain processes and business practices to keep pace with the economic, competitive and technological environment; the effect of inflation, interest rate increases and economic recession, which may negatively impact the Company's operations and financial results; deviation of actual results from estimates or assumptions used by the Company, including in the application of its significant accounting policies; impairment of the recorded value of inventory, equity investments, fixed assets, goodwill and other assets; competitive pressure on sales and pricing, including pressure from imports and substitute materials; the level of imports and import prices in the Company's markets and foreign currency exchange rate exposure; the impact of environmental laws and regulations or the actions of the United States Environmental Protection Agency or similar regulators that increase costs or limit the Company's ability to use or sell certain products; the impact of increasing environmental, greenhouse gas emission and sustainability regulations; the impact of judicial rulings and governmental regulations, both in the United States and abroad, including those adopted by the United States Securities and Exchange Commission (the "SEC") and other governmental agencies; the effect of healthcare laws in the United States and potential changes for such laws, which may increase the Company's healthcare and other costs and negatively impact the Company's operations and financial results; the effect of tax laws in the United States and potential changes for such laws, which may increase the Company's costs and negatively impact its operations and financial results; the operational, data privacy, security, regulatory and legal risks associated with the Company's reliance on artificial intelligence and machine learning technologies, its ability to stay abreast of technological advancements and its dependence on third parties that rely on such technologies; cybersecurity risks; the effects of privacy and information security laws and standards; the cyclical nature of the steel industry; the Company's safety performance; the effects of competition and price pressures from competitors; the Company's ability to pay dividends or repurchase shares, which is subject to business performance, capital requirements, financing arrangements, applicable law and the discretion of the Company's Board of Directors; and other risks described from time to time in the Company's filings with the SEC, including those described in "Part I – Item 1A. – Risk Factors" of the Company's most recent Annual Report on Form 10-K and its subsequent filings with the SEC. Forward-looking statements should be construed in the light of such risks. The Company notes these factors for investors as contemplated by the Act. It is impossible to predict or identify all potential risk factors. Consequently, you should not consider the foregoing list to be a complete set of all potential risks and uncertainties. Readers are cautioned not to place undue reliance on any forward-looking statements, which speak only as of the date made. The Company does not undertake, and hereby disclaims, any obligation to update any forward-looking statements, whether as a result of new information, future developments or otherwise, except as required by applicable law. WORTHINGTON STEEL, INC.CONSOLIDATED STATEMENTS OF EARNINGS(In millions, except per share amounts)(Unaudited) | | | | | Three Months Ended | | | August 31, | | | 2026 | | | 2025 | Net sales | | $ | 2,726.6 | | | $ | 872.9 | Cost of goods sold | | | 2,465.4 | | | | 757.7 | Gross margin | | | 261.2 | | | | 115.2 | Selling, general and administrative expense | | | 208.8 | | | | 67.9 | Restructuring and other income, net | | | (3.6 | ) | | | (1.0 | ) Operating income | | | 56.0 | | | | 48.3 | Other income (expense): | | | | | | Miscellaneous income (expense), net | | | (10.5 | ) | | | 0.2 | Interest expense, net | | | (38.8 | ) | | | (2.9 | ) Equity in net income of unconsolidated affiliate | | | 5.3 | | | | 6.4 | Earnings before income taxes | | | 12.0 | | | | 52.0 | Income tax expense | | | 12.1 | | | | 13.4 | Net earnings (loss) from continuing operations | | | (0.1 | ) | | | 38.6 | Net loss from discontinued operations | | | (4.9 | ) | | | - | Net earnings (loss) | | | (5.0 | ) | | | 38.6 | Net earnings attributable to noncontrolling interests | | | 5.0 | | | | 1.8 | Net earnings (loss) attributable to controlling interest | | $ | (10.0 | ) | | $ | 36.8 | | | | | | | Amounts attributable to controlling interest: | | | | | | Net earnings (loss) from continuing operations | | $ | (7.0 | ) | | $ | 36.8 | Net loss from discontinued operations | | | (3.0 | ) | | | - | Net earnings (loss) attributable to controlling interest | | $ | (10.0 | ) | | $ | 36.8 | | | | | | | Earnings (loss) per share – basic: | | | | | | Continuing operations | | $ | (0.14 | ) | | $ | 0.74 | Discontinued operations | | | (0.06 | ) | | | - | Consolidated | | $ | (0.20 | ) | | $ | 0.74 | | | | | | | Earnings (loss) per share – diluted: | | | | | | Continuing operations | | $ | (0.14 | ) | | $ | 0.73 | Discontinued operations | | | (0.06 | ) | | | - | Consolidated | | $ | (0.20 | ) | | $ | 0.73 | | | | | | | Weighted average common shares outstanding – basic | | | 50.0 | | | | 49.6 | Weighted average common shares outstanding – diluted | | | 50.0 | | | | 50.6 | | | | | | | Common shares outstanding at end of period | | | 50.1 | | | | 49.6 | | | | | | | Cash dividends declared per share | | $ | 0.16 | | | $ | 0.16 | WORTHINGTON STEEL, INC.CONSOLIDATED BALANCE SHEETS(In millions, except share amounts)(Unaudited) | | | | | | | | August 31, | | | May 31, | | | 2026 | | | 2026 | Assets | | | | | | Current assets: | | | | | | Cash and cash equivalents | | $ | 248.2 | | | $ | 84.6 | Receivables, less allowances of $1.6 and $1.1, respectively | | | 1,387.2 | | | | 496.2 | Inventories | | | | | | Raw materials | | | 935.9 | | | | 168.5 | Work in process | | | 182.1 | | | | 145.9 | Finished products | | | 592.4 | | | | 101.3 | Total inventories | | | 1,710.4 | | | | 415.7 | Income taxes receivable | | | 35.4 | | | | 14.3 | Assets held for sale | | | 9.1 | | | | 9.1 | Prepaid expenses and other current assets | | | 256.8 | | | | 110.0 | Current assets of discontinued operations | | | 180.1 | | | | - | Total current assets | | | 3,827.2 | | | | 1,129.9 | Investment in unconsolidated affiliates | | | 106.7 | | | | 123.4 | Operating lease right-of-use assets | | | 366.0 | | | | 77.8 | Finance lease right-of-use assets, net of accumulated amortization of $4.7 and $4.4, respectively | | | 21.8 | | | | 7.5 | Goodwill | | | 44.5 | | | | 44.5 | Other intangible assets, net of accumulated amortization of $67.6 and $65.9, respectively | | | 75.0 | | | | 77.3 | Deferred income taxes | | | 81.9 | | | | 12.7 | Equity securities | | | - | | | | 122.2 | Prepaid pension assets | | | 332.7 | | | | - | Other assets | | | 45.8 | | | | 7.8 | Property, plant and equipment: | | | | | | Land | | | 277.0 | | | | 57.2 | Buildings and improvements | | | 393.9 | | | | 272.5 | Machinery and equipment | | | 1,185.6 | | | | 1,065.0 | Construction in progress | | | 118.1 | | | | 105.9 | Total property, plant and equipment | | | 1,974.6 | | | | 1,500.6 | Less: accumulated depreciation | | | 874.3 | | | | 851.3 | Total property, plant and equipment, net | | | 1,100.3 | | | | 649.3 | Non-current assets held for sale | | | 19.3 | | | | - | Non-current assets of discontinued operations | | | 0.7 | | | | - | Total assets | | $ | 6,021.9 | | | $ | 2,252.4 | WORTHINGTON STEEL, INC.CONSOLIDATED BALANCE SHEETS(In millions, except share amounts)(Unaudited) | | | | | | | | August 31, | | | May 31, | | | 2026 | | | 2026 | Liabilities, mezzanine equity, and equity | | | | | | Current liabilities: | | | | | | Accounts payable | | $ | 1,170.8 | | | $ | 424.0 | Short-term borrowings | | | 530.9 | | | | 185.4 | Accrued compensation, contributions to employee benefit plans and related taxes | | | 107.4 | | | | 60.0 | Dividends payable | | | 9.2 | | | | 9.2 | Other accrued items | | | 120.3 | | | | 56.2 | Current operating lease liabilities | | | 40.1 | | | | 10.4 | Current finance lease liabilities | | | 4.9 | | | | 2.9 | Income taxes payable | | | 6.6 | | | | 0.7 | Current maturities of long-term debt | | | 10.7 | | | | 27.0 | Current liabilities of discontinued operations | | | 108.4 | | | | - | Total current liabilities | | | 2,109.3 | | | | 775.8 | Other liabilities | | | 83.3 | | | | 51.5 | Long-term debt | | | 1,654.8 | | | | 44.4 | Noncurrent operating lease liabilities | | | 338.8 | | | | 78.7 | Noncurrent finance lease liabilities | | | 14.4 | | | | 5.5 | Deferred income taxes | | | 112.0 | | | | 33.6 | Non-current liabilities of discontinued operations | | | 9.0 | | | | - | Total liabilities | | | 4,321.6 | | | | 989.5 | | | | | | | Mezzanine equity: | | | | | | Redeemable noncontrolling interest | | | 63.8 | | | | 65.3 | Total mezzanine equity | | | 63.8 | | | | 65.3 | | | | | | | Shareholders' equity - controlling interest: | | | | | | Preferred shares, without par value; authorized – 1,000,000 shares; no shares issued or outstanding | | | - | | | | - | Common shares, without par value; authorized – 150,000,000 shares; issued | | | | | | and outstanding 50,071,412 shares and 49,920,298 shares, respectively | | | - | | | | - | Additional Paid-in Capital | | | 926.1 | | | | 919.4 | Retained Earnings | | | 121.8 | | | | 140.0 | Accumulated other comprehensive income (loss), net of taxes of $(1.0) and $(2.3), respectively | | | (15.6 | ) | | | 3.9 | Total Shareholders' equity – controlling interest | | | 1,032.3 | | | | 1,063.3 | Noncontrolling interests | | | 604.2 | | | | 134.3 | Total equity | | | 1,636.5 | | | | 1,197.6 | Total liabilities, mezzanine equity, and equity | | $ | 6,021.9 | | | $ | 2,252.4 | WORTHINGTON STEEL, INC.CONSOLIDATED STATEMENTS OF CASH FLOWS(In millions)(Unaudited) | | | | | Three Months Ended | | | August 31, | | | 2026 | | | 2025 | Operating activities: | | | | | | Net earnings (loss) | | $ | (5.0 | ) | | $ | 38.6 | Adjustment to reconcile net earnings (loss) to net cash provided by operating activities: | | | | | | Loss from discontinued operations, net | | | 4.9 | | | | - | Depreciation and amortization | | | 27.8 | | | | 20.3 | Benefit from deferred income taxes | | | (4.4 | ) | | | (1.4 | ) Bad debt expense (income) | | | 0.2 | | | | (0.1 | ) Equity in net income of unconsolidated affiliate, net of distributions | | | 16.7 | | | | (6.4 | ) Net gain on sale of assets | | | (4.7 | ) | | | (0.8 | ) Stock-based compensation | | | 2.3 | | | | 7.4 | Realized loss on equity investment | | | 15.5 | | | | - | Noncash restructuring and other expense | | | 1.0 | | | | - | Changes in assets and liabilities, net of impact of acquisitions: | | | | | | Receivables | | | (42.4 | ) | | | (15.9 | ) Inventories | | | (42.9 | ) | | | (16.4 | ) Accounts payable | | | 30.7 | | | | (46.7 | ) Accrued compensation and employee benefits | | | (8.5 | ) | | | (0.2 | ...

COLUMBUS, Ohio, October 06, 2026--(BUSINESS WIRE)--The board of directors of Worthington Steel, Inc. (NYSE: WS) has declared a quarterly dividend of $0.16 per common share. The dividend is payable on December 28, 2026, to shareholders of record at the close of business on December 14, 2026. Worthington Steel will host a conference call to discuss its fiscal 2027 first quarter results at 8:30 a.m. ET on Wednesday, October 7, 2026. The conference call can be accessed by registering online at the link below. A live webcast of the call will be available through Events & Presentations in the Investors section of the Company's website at WorthingtonSteel.com and will be archived for one year. Live Conference Call Schedule Date: | | | | Wednesday, October 7, 2026 Start Time: | | | | 8:30 a.m. ET Registration Link: | | | | https://events.q4inc.com/attendee/682402066 To automatically receive Worthington Steel financial news by email, please visit https://ir.worthingtonsteel.com and subscribe to email alerts. About Worthington Steel Worthington Steel (NYSE: WS) is one of North America's leading value-added metals processing and manufacturing companies. The company partners with customers to deliver specialized, highly technical solutions across carbon flat-rolled steel, aluminum, stainless steel, long products, heavy plate and electrical steel, to solve complex challenges across a broad range of industries. Worthington Steel employs approximately 12,000 people and operates approximately 150 facilities, primarily in North America, with additional operations in Europe and Asia. The company combines extensive processing expertise with advanced manufacturing technologies, including galvanizing, pickling, configured blanking, specialty cold reduction, electrical steel laminations, fabrication and precision processing. Guided by its people-first Philosophy and a commitment to safety, innovation and continuous improvement, Worthington Steel creates long-term value by delivering trusted solutions for customers, opportunities for employees, returns for shareholders and strength for the communities where it operates. Important Information: On September 8, 2026, Worthington Steel and Kloeckner & Co entered into a Domination and Profit and Loss Transfer Agreement ("DPLTA"), which remains subject to approval by Kloeckner shareholders and the registration with the competent commercial register before becoming effective. Until the DPLTA becomes effective, Kloeckner continues to operate independently. The employee and facility counts above reflect the expected combined organization following the DPLTA becoming effective. Safe Harbor Statement Worthington Steel wishes to take advantage of the safe harbor provisions included in the Private Securities Litigation Reform Act of 1995 (the "Act"). Statements by Worthington Steel which are not historical information constitute "forward looking statements" within the meaning of the Act. All forward-looking statements are subject to risks and uncertainties which could cause actual results to differ from those projected. Factors that could cause actual results to differ materially include risks, uncertainties and impacts described from time to time in Worthington Steel's filings with the Securities and Exchange Commission. View source version on businesswire.com: https://www.businesswire.com/news/home/20261005457896/en/ Contacts Melissa Dykstra Vice President Corporate Communications and Investor Relations Phone: 614-840-4144 [email protected]