Schnitzer Steel Industries Inc (SCHN) Q1 2015 Earnings Call Transcript

Tamara Lundgren, President, CEO
No, no, I wouldn’t think that at all. Again, we are a spread business. The flexibility of our platform allows us to meet demand wherever it is greatest, so we pursue all markets aggressively and direct our product to where it benefits the bottom line most effectively. So that means we look for and add new customers to the export market, we add new customers to the domestic market, and that’s true for both ferrous and non-ferrous products.

David Lipschitz, CLSA
But if you are buying here and then selling back into here, it’s just not – the spread is still similar to what – the spread I’m not saying is similar to what an export is, but you still can make as much as you did when export was booming to Asia and things like that?

Tamara Lundgren, President, CEO
At the end of the day, it all depends upon where prices selling prices are, how robust the U.S. economy is in terms of generating scrap because, remember, scrap can’t just be mined. Its existence is driven through consumer demand and industrial production. So it’s a combination of factors that drive metal spreads at any point in time.

David Lipschitz, CLSA
Okay. Then, a follow up question on the steel business. We have seen hot roll prices go down significantly. Rebar really hasn’t moved much. For the West Coast, in terms of prices, have prices held up? I know demand is strong, but have prices held up? Are you seeing any pressure on prices out there?

Operator
Thank you. Our next question comes from the line of Phil Gibbs from KeyBanc.

Phil Gibbs, KeyBanc
Good morning. Hello?

Operator
Your line is still connected, one moment. Ladies and gentlemen, we will now resume. Our next question comes from the line of Phil Gibbs.

Tamara Lundgren, President, CEO
But we have – we lost…

Richard Peach, CFO, SVP
Dave Lipschitz.

Tamara Lundgren, President, CEO
Yes. Dave, we will put you back in the queue. Good afternoon, good morning, Phil. We are not sure what happened. But we were disconnected.

Phil Gibbs, KeyBanc
I’m here.

Tamara Lundgren, President, CEO
Okay.

Phil Gibbs, KeyBanc
Good morning. Thanks for taking my other question. I have strong execution in a very tough environment.

Tamara lundgren, President, CEO
Thank you.

Phil Gibbs, KeyBanc
Question just on thoughts about rationalizing your export footprint to the extent that the demand environment stays weak for exports. I know that Sims has got some aggressive new management in place and maybe have taken some of their projects off the drawing board or scrutinized them a little bit more about adding capacity, just where that might fit in your thought process moving forward.

Tamara Lundgren, President, CEO
I am not sure I follow your question. What are you asking?