Metallus Announces Second-Quarter 2026 Results

• Net sales of $341.0 million, up 11% sequentially and 12% year over year, while net income increased to $8.9 million from $5.4 million in the first quarter and $3.7 million in the prior-year quarter
• Adjusted EBITDA of $29.0 million, an increase of 18% sequentially and 9% year over year
• Invested $15.2 million in strategic capital expenditures and $3.6 million to repurchase common shares
• Growth in order book reinforces strong demand visibility for the second half of 2026
• Bloom reheat furnace commissioned; roller furnace remains on schedule
• Refinanced Credit Agreement to 2031 while providing adequate liquidity and flexibility
• Cash and cash equivalents of $108.6 million with total liquidity ⁽¹⁾of $394.8 million as of June 30, 2026

CANTON, Ohio, Aug. 3, 2026 /PRNewswire/ -- Metallus (NYSE: MTUS), a leader in high-quality specialty metals, manufactured components and supply chain solutions, today reported second-quarter 2026 net sales of $341.0 million and net income of $8.9 million, or $0.21 per diluted share. On an adjusted basis⁽²⁾, the second-quarter 2026 net income was $11.1 million, or $0.26 per diluted share, and adjusted EBITDA was $29.0 million.

This compares with the sequential first-quarter 2026 net sales of $308.3 million and net income of $5.4 million, or $0.13 per diluted share. On an adjusted basis⁽²⁾, the first-quarter 2026 net income was $7.7 million, or $0.18 per diluted share, and adjusted EBITDA was $24.6 million.

In the same quarter last year, the company had net sales of $304.6 million and net income of $3.7 million, or $0.09 per diluted share. On an adjusted basis⁽²⁾, the second-quarter 2025 net income was $8.2 million, or $0.19 per diluted share, and adjusted EBITDA was $26.5 million.

"We delivered a strong second quarter, highlighted by increased shipments, improved pricing and product mix and higher profitability both sequentially and compared with the prior year. Demand remains healthy across our key end markets, supported by a robust order book that provides strong visibility for the second half of 2026. We successfully completed the commissioning of our new bloom reheat furnace and the roller furnace remains on schedule. These investments represent important milestones in our commitment to growing our presence in the aerospace & defense market while continuing to support our long-standing automotive, industrial, energy and distribution customers. The recent investments enhance our manufacturing capabilities, improve operational efficiency, and strengthen our ability to meet increasing customer demand," said Mike Williams, chief executive officer.

"As we enter the second half of 2026, we have a healthy order book, favorable product mix, continued pricing momentum and a daily focus on operational execution. As a result, we expect that profitability will continue to improve compared to the same periods last year and cash flow generation will be positive."

SECOND-QUARTER 2026 FINANCIAL SUMMARY

• Net sales increased 11 percent to $341.0 million, compared with $308.3 million in the first quarter of 2026. Compared with the prior-year second quarter, net sales increased 12 percent. The increases in both comparable periods were driven primarily by higher shipments across the majority of end-markets, increased raw material surcharge revenue per ton, higher average base sales⁽²⁾ prices and improved product mix.

• Ship tons increased 10,400 tons sequentially, or 6 percent, to 174,200 tons driven primarily by higher shipments across the majority of end-markets. Compared with the prior-year second quarter, shipments increased 4 percent, driven by higher shipments in automotive and aerospace & defense end-markets.

• Melt utilization improved to 74 percent in the second quarter, up from 72 percent in the first quarter and 71 percent in the same quarter last year. Manufacturing cost performance declined sequentially, due to lower than expected fixed-cost absorption, as melt utilization improved but fell short of plan, along with higher maintenance costs to address downstream asset reliability.

CASH, LIQUIDITY AND REPURCHASE ACTIVITY

As of June 30, 2026, the company's cash and cash equivalents balance was $108.6 million. In the second quarter, operating cash flow totaled $12.8 million, driven by profitability and lower inventory, partially offset by lower accounts payable due to the timing of raw material purchases and required pension contributions. Capital expenditures totaled $15.2 million in the second quarter, including $9.5 million for projects primarily funded by the U.S. government. Total liquidity⁽¹⁾ was $394.8 million as of June 30, 2026.

On June 30, 2026, the company refinanced its asset-based revolving credit facility ("Credit Facility") and extended the maturity date to June 2031. Following the amendment, Credit Facility available capacity was $300.0 million with improvement in a variety of financial terms and covenants, including reduced annual fees. The Credit Facility remains undrawn at this time.

Additionally, during the second quarter, the company repurchased 0.2 million common shares at an aggregate cost of $3.6 million. As of June 30, 2026, the company had $81.8 million remaining under its authorized share repurchase program.

During the second quarter, the company received the final $11.3 million from the U.S. Army as part of the previously announced $99.75 million capacity expansion funding agreement in support of the U.S. Army's mission of ramping up munitions production. Through the end of June, the company had received $102.8 million of government funding, consisting of $99.75 million from the U.S. Army and $3.0 million from JobsOhio as part of the previously announced grant. 

OUTLOOK

Given the elements outlined in the outlook below, the company expects third-quarter adjusted EBITDA to be slightly higher than the second quarter of 2026 and the third quarter of 2025.

Commercial:

• Third-quarter shipments are expected to be similar to second-quarter shipments based on the customer mix and lead time expectations.
  
  
• Lead times for bar and tube products currently extend into late fourth quarter.
  
  
• Based on lead times and product mix, third quarter price and mix are expected to be slightly better than the second quarter.
  
  
• The company recently announced price increases effective early August for customers not covered by annual pricing agreements of $60 per ton on bar, $100 per ton on carbon seamless mechanical tubing, and $160 per ton on alloy seamless mechanical tubing products. Based on lead times, the company expects to realize the full run rate benefit of these price increases beginning in 2027.

Operations:

• The company anticipates a slight increase in its third quarter average melt utilization rate, supported by strength in the order book.

• Manufacturing costs are expected to be relatively flat sequentially as a result of slightly higher melt utilization offset by increased planned maintenance outages.

Other matters:

• Planned capital expenditures remain at approximately $70 million in 2026, inclusive of $35 million of capital expenditures partially funded by the U.S. government.

• The company does not expect to make any additional pension contributions during the remainder of 2026.

• An adjusted effective income tax rate⁽³⁾ between 27 and 30 percent is expected for the full year 2026.

METALLUS EARNINGS WEBCAST INFORMATION
Metallus will provide live Internet listening access to its conference call with the financial community scheduled for Tuesday, August 4, 2026, at 9:00 a.m. ET. The live conference call will be broadcast at investors.metallus.com. A replay of the conference call will also be available at investors.metallus.com.

ABOUT METALLUS INC.
Metallus (NYSE: MTUS) manufactures high-performance specialty metals from recycled scrap metal in Canton, OH, serving demanding applications in industrial, automotive, aerospace & defense and energy end-markets. The company is a premier U.S. producer of alloy steel bars (up to 16 inches in diameter), seamless mechanical tubing and manufactured components. In the business of making high-quality steel for more than 100 years, Metallus' proven expertise contributes to the performance of our customers' products. The company employs approximately 1,905 people and had sales of $1.2 billion in 2025. For more information, please visit us at www.metallus.com.

NON-GAAP FINANCIAL MEASURES
Metallus reports its financial results in accordance with accounting principles generally accepted in the United States ("GAAP") and corresponding metrics as non-GAAP financial measures. This earnings release includes references to the following non-GAAP financial measures: adjusted earnings (loss) per share, adjusted net income (loss), EBITDA, adjusted EBITDA, free cash flow, base sales, and other adjusted items. These are important financial measures used in the management of the business, including decisions concerning the allocation of resources and assessment of performance. Management believes that reporting these non-GAAP financial measures is useful to investors as these measures are representative of the company's performance and provide improved comparability of results. See the attached schedules for definitions of the non-GAAP financial measures referred to above and corresponding reconciliations of these non-GAAP financial measures to the most comparable GAAP financial measures. Non-GAAP financial measures should be viewed as additions to, and not as alternatives for, Metallus' results prepared in accordance with GAAP. In addition, the non-GAAP measures Metallus uses may differ from non-GAAP measures used by other companies, and other companies may not define the non-GAAP measures Metallus uses in the same way.

FORWARD-LOOKING STATEMENTS
This news release includes "forward-looking" statements within the meaning of the federal securities laws. You can generally identify the company's forward-looking statements by words such as "will," "anticipate," "aspire," "believe," "could," "estimate," "expect," "forecast," "outlook," "intend," "may," "plan," "possible," "potential," "predict," "project," "seek," "target," "should," "would," "strategy," or "strategic direction" or other similar words, phrases or expressions that convey the uncertainty of future events or outcomes. The company cautions readers that actual results may differ materially from those expressed or implied in forward-looking statements made by or on behalf of the company due to a variety of factors, such as: (1) the effects of fluctuations in customer demand on sales, product mix and prices in the industries in which the company operates, including the ability of the company to respond to rapid changes in customer demand including but not limited to changes in domestic and worldwide political and economic conditions due to, among other factors, U.S. and foreign trade policies and the impact on economic conditions, changes in customer operating schedules due to supply chain constraints or unplanned work stoppages, the ability of customers to obtain financing to purchase the company's products or equipment that contains its products, the effects of customer bankruptcies or liquidations, the impact of changes in industrial business cycles, and whether conditions of fair trade exist in U.S. markets; (2) changes in operating costs, including the effect of changes in the company's manufacturing processes, changes in costs associated with varying levels of operations and manufacturing capacity, availability of raw materials and energy, the company's ability to mitigate the impact of fluctuations in raw materials and energy costs and the effectiveness of its surcharge mechanism, changes in the expected costs associated with product warranty claims, changes resulting from inventory management, cost reduction initiatives and different levels of customer demands, the effects of unplanned work stoppages, availability of skilled labor and changes in the cost of labor and benefits; (3) the success of the company's operating plans, announced programs, initiatives and capital investments, the consistency to meet demand levels following unplanned downtime, and the company's ability to maintain appropriate relations with the union that represents its associates in certain locations in order to avoid disruptions of business; (4) whether the company is able to successfully implement actions designed to improve profitability on anticipated terms and timetables and whether the company is able to fully realize the expected benefits of such actions; (5) the company's pension obligations and investment performance; (6) with respect to the company's ability to achieve its sustainability goals, including its 2030 environmental goals, the ability to meet such goals within the expected timeframe, changes in laws, regulations, prevailing standards or public policy, the alignment of the scientific community on measurement and reporting approaches, the complexity of commodity supply chains and the evolution of and adoption of new technology, including traceability practices, tools and processes; (7) availability of property insurance coverage at commercially reasonable rates or insufficient insurance coverage to cover claims or damages; (8) the availability of financing and interest rates, which affect the company's cost of funds and/or ability to raise capital; (9) the impacts from any repurchases of our common shares, including the timing and amount of any repurchases; (10) competitive factors, including changes in market penetration, increasing price competition by existing or new foreign and domestic competitors, the introduction of new products by existing and new competitors, and new technology that may impact the way the company's products are sold or distributed; (11) deterioration in global economic conditions, or in economic conditions in any of the geographic regions in which the company conducts business, including additional adverse effects from global economic slowdown, terrorism or hostilities, including political risks associated with the potential instability of governments and legal systems in countries in which the company or its customers conduct business, and changes in currency valuations; (12) the impact of global conflicts on the economy, sourcing of raw materials, and commodity prices; (13) climate-related risks, including environmental and severe weather caused by climate changes, and legislative and regulatory initiatives addressing global climate change or other environmental concerns; (14) unanticipated litigation, claims or assessments, including claims or problems related to intellectual property, product liability or warranty, employment matters, regulatory compliance and environmental issues and taxes, among other matters; (15) cyber-related risks, including information technology system failures, interruptions and security breaches; (16) the potential impact of pandemics, epidemics, widespread illness or other health issues; and (17) with respect to the equipment investments to support the U.S. Army's mission of ramping up munitions production in the coming years, and whether the anticipated increase in throughput is achieved. Further, this news release represents our current policy and intent and is not intended to create legal rights or obligations. Certain standards of measurement and performance contained in this news release are developing and based on assumptions, and no assurance can be given that any plan, objective, initiative, projection, goal, mission, commitment, expectation or prospect set forth in this news release can or will be achieved. Inclusion of information in this news release is not an indication that the subject or information is material to our business or operating results.

Additional risks relating to the company's business, the industries in which the company operates, or the company's common shares may be described from time to time in the company's filings with the SEC. All of these risk factors are difficult to predict, are subject to material uncertainties that may affect actual results and may be beyond the company's control. Readers are cautioned that it is not possible to predict or identify all of the risks, uncertainties and other factors that may affect future results and that the above list should not be considered to be a complete list. Except as required by the federal securities laws, the company undertakes no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.

CONSOLIDATED STATEMENTS OF CASH FLOWS

This reconciliation is provided as additional relevant information about the company's financial position. Free cash flow is an important financial measure used in the management of the business. Management believes that free cash flow is useful to investors because it is a meaningful indicator of cash generated from operating activities available for the execution of its business strategy.

Reconciliation of Capital expenditures less government-funded capital expenditures to GAAP Capital expenditures:

This reconciliation is provided as additional relevant information about the company's capital expenditures. Capital expenditures less government-funded capital expenditures is an important financial measure used in the management of the business. Management believes that capital expenditures less government-funded capital expenditures is useful to investors because it is a meaningful indicator of capital expenditures associated with the ordinary course of the company's business.

Adjusted net income (loss) and adjusted diluted earnings (loss) per share are financial measures not required by or presented in accordance with GAAP. These Non-GAAP financial measures should be considered as a supplement to, and not as a substitute for, the financial measures prepared in accordance with GAAP, and a reconciliation of these financial measures to the most comparable GAAP financial measures is presented. Management believes this data provides investors with additional useful information on the underlying operations and trends of the business and enables period-to-period comparability of the company's financial performance.

Reconciliation of adjusted net income (loss)⁽²⁾ to GAAP net income (loss) and adjusted diluted earnings (loss) per share⁽²⁾ to GAAP diluted earnings (loss) per share for the six months ended June 30, 2026 and June 30, 2025:

Adjusted net income (loss) and adjusted diluted earnings (loss) per share are financial measures not required by, or presented in accordance with GAAP. These Non-GAAP financial measures should be considered as a supplement to, and not as a substitute for, the financial measures prepared in accordance with GAAP, and a reconciliation of these financial measures to the most comparable GAAP financial measures is presented. Management believes this data provides investors with additional useful information on the underlying operations and trends of the business and enables period-to-period comparability of the company's financial performance.

Reconciliation of adjusted effective tax rate to GAAP effective tax rate for the three months ended June 30, 2026, June 30, 2025, and March 31, 2026:

This reconciliation is provided as additional relevant information between the company's GAAP effective tax rate and the adjusted effective tax rate. These Non-GAAP financial measures should be considered as a supplement to, and not as a substitute for, the financial measures prepared in accordance with GAAP, and a reconciliation of these financial measures to the most comparable GAAP financial measures is presented. Management believes this data provides investors with additional useful information on the underlying operations and trends of the business and enables period-to-period comparability of the company's financial performance.

Reconciliation of adjusted effective tax rate to GAAP effective tax rate for the six months ended June 30, 2026 and June 30, 2025:

This reconciliation is provided as additional relevant information between the company's GAAP effective tax rate and the adjusted effective tax rate. These Non-GAAP financial measures should be considered as a supplement to, and not as a substitute for, the financial measures prepared in accordance with GAAP, and a reconciliation of these financial measures to the most comparable GAAP financial measures is presented. Management believes this data provides investors with additional useful information on the underlying operations and trends of the business and enables period-to-period comparability of the company's financial performance.

Reconciliation of Earnings (Loss) Before Interest, Taxes, Depreciation and Amortization (EBITDA)⁽³⁾ and Adjusted EBITDA⁽¹⁰⁾ to GAAP Net Income (Loss):

This reconciliation is provided as additional relevant information about the company's performance. EBITDA and Adjusted EBITDA are important financial measures used in the management of the business, including decisions concerning the allocation of resources and assessment of performance. Management believes that reporting EBITDA and Adjusted EBITDA is useful to investors as these measures are representative of the company's performance. Management also believes that it is appropriate to compare GAAP net income (loss) to EBITDA and Adjusted EBITDA.

Reconciliation of Base Sales by end-market to GAAP Net Sales by end-market:

The tables below present net sales by end-market, adjusted to exclude surcharges, which represents a financial measure that has not been determined in accordance with GAAP. Management believes presenting net sales by end-market, both on a gross basis and on a per ton basis, adjusted to exclude raw material and energy surcharges, provides additional insight into key drivers of net sales such as base price and product mix. Due to the fact that the surcharge mechanism can introduce volatility to our net sales, net sales adjusted to exclude surcharges provides management and investors clarity of our core pricing and results. Presenting net sales by end-market, adjusted to exclude surcharges including on a per ton basis, allows management and investors to better analyze key market indicators and trends and allows for enhanced comparison between our end-markets.

When surcharges are included in a customer agreement and are applicable (i.e., reach the threshold amount), based on the terms outlined in the respective agreement, surcharges are then included as separate line items on a customer's invoice. These additional surcharge line items adjust base prices to match cost fluctuations due to market conditions. Each month, the company will post on the surcharges page of its external website, as well as our customer portal, the scrap, alloy, and energy surcharges that will be applied (as a separate line item) to invoices dated in the following month (based upon shipment volumes in the following month). All surcharges invoiced are included in GAAP net sales.

Calculation of Total Liquidity⁽¹⁾:

This calculation is provided as additional relevant information about the company's financial position.

(Dollars in millions) (Unaudited)

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SOURCE Metallus Inc.