Tree Island Steel Ltd
TSX:TSL
Tree Island Steel Ltd
Tree Island Steel Ltd. engages in the manufacturing and supplying of steel wire and fabricated wire products. The company is headquartered in Richmond British Columbia, British Columbia and currently employs 480 full-time employees. The company went IPO on 2002-11-12. The firm is engaged in making products from steel wire for a range of customers for industrial, construction, agricultural and specialty applications. The Company, through its four operating facilities in Canada and the United States, produces wire products for a diverse range of industrial, residential construction, commercial construction and agricultural applications. The Company’s products include galvanized wire, bright wire; a broad array of fasteners, including packaged, collated and bulk nails; stucco reinforcing products; concrete reinforcing mesh; fencing and other fabricated wire products. The firm markets its products under the Tree Island, Halsteel, K-Lath, TI Wire, Tough Strand and ToughPanel brand names.
Tree Island Steel Ltd. engages in the manufacturing and supplying of steel wire and fabricated wire products. The company is headquartered in Richmond British Columbia, British Columbia and currently employs 480 full-time employees. The company went IPO on 2002-11-12. The firm is engaged in making products from steel wire for a range of customers for industrial, construction, agricultural and specialty applications. The Company, through its four operating facilities in Canada and the United States, produces wire products for a diverse range of industrial, residential construction, commercial construction and agricultural applications. The Company’s products include galvanized wire, bright wire; a broad array of fasteners, including packaged, collated and bulk nails; stucco reinforcing products; concrete reinforcing mesh; fencing and other fabricated wire products. The firm markets its products under the Tree Island, Halsteel, K-Lath, TI Wire, Tough Strand and ToughPanel brand names.
Revenue Drop: Tree Island Steel reported Q2 2019 revenue of $52.6 million, down 22.7% from last year, mainly due to U.S. tariffs and lower residential demand.
Margin Pressure: Gross profit margin fell to 9.3% from 12.5% last year, with EBITDA also declining sharply by 52.3%.
Tariff Relief: The removal of U.S. Section 232 tariffs on Canadian steel has started to improve customer interest, but benefits will take time to appear in results.
Cost Controls: SG&A expenses were reduced by 9.7% year-over-year through cost-cutting initiatives.
Acquisition Proposal: Tree Island received a nonbinding buyout offer at $2.25 per share; a special committee and independent valuation process are underway.
No Earnings Guidance: Management reiterated they will not provide future earnings guidance.
