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Commercial Metals Reports Q4 Earnings Growth and Plans $400M FY2027 Capex

BullishMedium impact
CMC$65.37 0.12%

Commercial Metals Company (CMC) reported fourth-quarter revenue of $2.658 billion, up 25.7% from the previous year, alongside net income of $212.5 million and adjusted earnings per share of $2.09. Consolidated core EBITDA reached $393.7 million, yielding a 14.8% margin, while full-year EBITDA landed between $1.36 billion and $1.4 billion. Earnings were driven by North America Steel, where adjusted EBITDA climbed 32.6% to $317.5 million, and Construction Solutions, which generated $431.4 million in sales. The company also declared a quarterly dividend of $0.20 per share.

Strong operating performance enabled the steel manufacturer to lower its net leverage ratio to 1.9x, successfully beating its internal target of 2.0x. With leverage reduced, management plans to accelerate share repurchases using its remaining authorization of roughly $700 million. At the same time, capital spending will decrease in fiscal 2027 to approximately $400 million, down from the prior year's level, reflecting a shift toward disciplined balance sheet management and returning cash to shareholders.

Investors will be watching key growth projects as they transition into commercial operation. In West Virginia, the company's new micro-mill rolled its first billet and is currently undergoing hot commissioning. Additionally, a new Tensar geogrid line in Blackwell, Oklahoma is in startup, while the GalvaBar facility in Tennessee is scheduled to begin production in November, a move expected to more than double total GalvaBar capacity.

Key points

  • Commercial Metals Company reported fourth-quarter revenue of $2.658 billion, up 25.7% year-over-year, and adjusted earnings per share of $2.09.
  • Net leverage decreased to 1.9x, dropping below the 2.0x corporate goal and prompting plans to speed up share buybacks with $700 million remaining authorization.
  • Fiscal 2027 capital expenditures are expected to be around $400 million, down from fiscal 2026 levels.
  • Growth initiatives include the West Virginia micro-mill in hot commissioning, startup of an Oklahoma geogrid line, and a November production start for GalvaBar Tennessee.

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Questions and answers

What were Commercial Metals Company's fourth-quarter earnings and revenue?

Commercial Metals Company reported Q4 revenue of $2.658 billion, up 25.7% year-over-year, and adjusted earnings per share of $2.09, with net income totaling $212.5 million.

How much does Commercial Metals plan to spend on capex in fiscal 2027?

Commercial Metals plans roughly $400 million in capital expenditures for fiscal 2027, which is lower than its spending in the prior year as major growth projects advance.

What is Commercial Metals doing with its share buybacks and dividends?

Commercial Metals declared a $0.20 per share dividend and plans to accelerate share repurchases, with approximately $700 million remaining in buyback authorization after cutting net leverage to 1.9x.