• Net Sales of $53.6 Million Increase 3% Sequentially and 11% from 2013 Third Quarter
• Gross Margin at Two-Year High of 16.1% of Sales; Operating Income is $3.1 Million
• Net Income Totals $1.4 Million, or $0.20 per Diluted Share
• Third Quarter 2014 Backlog 52% Higher than Third Quarter 2013

BRIDGEVILLE, Pa., Oct. 29, 2014 (GLOBE NEWSWIRE) -- Universal Stainless & Alloy Products, Inc. (Nasdaq:USAP) today reported that net sales for the third quarter of 2014 were $53.6 million, an increase of 3% from the second quarter of 2014, and 11% higher than the third quarter of 2013. For the first nine months of 2014, net sales increased 9% to $152.6 million compared with net sales of $140.5 million in the same period of 2013, with premium alloy products accounting for 7% of total net sales.

Third quarter 2014 net sales were led by the aerospace market which grew by 6% sequentially over the second quarter of 2014 and by 11% over the third quarter of 2013. Aerospace represented 60% of total net sales. Compared to the third quarter of 2013, the Company's sales increased to all of its end markets with the exception of power generation. With a strong pick-up in order entry in September, the Company's backlog (before surcharges) was $61 million at the end of the third quarter of 2014, remaining level with the end of the 2014 second quarter, but 52% higher than at the end of the third quarter of 2013.   

The Company's gross margin for the third quarter of 2014 was $8.6 million, or 16.1% of sales, which is essentially the same as the second quarter of 2014, but substantially higher than the third quarter of 2013 when the gross margin was $2.4 million, or 5.0% of net sales. The improvement in the Company's third quarter 2014 gross margin compared to the same prior year period is primarily attributable to an improved product mix, management's initiatives to improve yields and lower scrap rates, and higher manufacturing activity.   

Operating income for the third quarter of 2014 was $3.1 million, or almost equal with the second quarter of 2014.  In the third quarter of 2013, the Company posted an operating loss of $2.0 million. Third quarter 2014 operating income included approximately $0.2 million in selling, general and administrative expenses related to placement fees as management continues to strengthen the organization for future growth.  

The Company reported net income of $1.4 million, or $0.20 per diluted share, for the third quarter of 2014, which matches the $1.4 million, or $0.20 per diluted share, reported in the second quarter of 2014. In the third quarter of 2013, the Company recorded a net loss of $1.7 million, or $0.25 per diluted share.  

Net income for the first nine months of 2014 increased to $2.3 million, or $0.33 per diluted share, compared to a net loss of $1.2 million, or $0.17 per diluted share, in the first nine months of 2013.  Included in the results for the first nine months of 2014 were state tax charges, which were primarily non-cash, of approximately $0.9 million that negatively impacted earnings per share by $0.12.                                  

For the third quarter of 2014, the Company generated cash from operations of $3.8 million.  At September 30, 2014, total debt was $91.1 million, or approximately the same level as the end of the second quarter of 2014.   Debt to total capitalization was 31.2% at the end of the 2014 third quarter.   

Chairman, President and CEO Dennis Oates commented: "Third quarter sales increased 3% sequentially reaching their highest level in two years and overcoming normal seasonal slowness. Our initiatives to manage product mix and improve yields were major positive contributors in maintaining a two-year-high gross profit margin of 16.1%. Overall order entry remains solid with September marking the second highest monthly level since early 2012.

"Overall, market conditions have been stronger this year than in 2013 and we are well positioned to participate in future growth. We are monitoring any short-term impacts from recent volatile global issues and the decline in commodity prices, although the outlook for the end markets we target, especially aerospace, continues to be positive. Additionally, our latest discussions with customers indicate that their optimism for further improvement in 2015 remains unchanged."

Webcast

The Company has scheduled a conference call for today, October 29, at 10:00 a.m. (Eastern) to discuss third quarter 2014 results. A simultaneous webcast will be available on the Company's website at www.univstainless.com, and thereafter archived on the website through the end of the fourth quarter of 2014.  

About Universal Stainless & Alloy Products, Inc.

Universal Stainless & Alloy Products, Inc., headquartered in Bridgeville, PA, manufactures and markets semi-finished and finished specialty steels, including stainless steel, nickel alloys, tool steel and certain other alloyed steels. The Company's products are used in a variety of industries, including aerospace, power generation, oil and gas, and heavy equipment manufacturing. Established in 1994, the Company, with its experience, technical expertise, and dedicated workforce, stands committed to providing the best quality, delivery, and service possible. More information is available at www.univstainless.com.

Forward-Looking Information Safe Harbor

Except for historical information contained herein, the statements in this release are forward-looking statements that are made pursuant to the "safe harbor" provision of the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve known and unknown risks and uncertainties that may cause the Company's actual results in future periods to differ materially from forecasted results. Those risks include, among others, the concentrated nature of the Company's customer base to date and the Company's dependence on its significant customers; the receipt, pricing and timing of future customer orders; changes in product mix; the limited number of raw material and energy suppliers and significant fluctuations that may occur in raw material and energy prices; risks related to property, plant and equipment,  including the Company's reliance on the continuing operation of critical manufacturing equipment; risks associated with labor matters; the Company's ongoing requirement for continued compliance with laws and regulations, including applicable safety and environmental regulations; the ultimate outcome of the Company's current and future litigation and matters; risks related to acquisitions that the Company may make; and the impact of various economic, credit and market risk uncertainties. Many of these factors are not within the Company's control and involve known and unknown risks and uncertainties that may cause the Company's actual results in future periods to be materially different from any future performance suggested herein. Any unfavorable change in the foregoing or other factors could have a material adverse effect on the Company's business, financial condition and results of operations. Further, the Company operates in an industry sector where securities values may be volatile and may be influenced by economic and other factors beyond the Company's control. Certain of these risks and other risks are described in the Company's filings with the Securities and Exchange Commission (SEC) over the last 12 months, copies of which are available from the SEC or may be obtained upon request from the Company.

CONTACT: Dennis M. Oates

         Chairman,

         President and CEO

         (412) 257-7609

         

         Michael D. Bornak

         VP Finance, CFO

         and Treasurer

         (412) 257-7606

         

         June Filingeri

         President

         Comm-Partners LLC

         (203) 972-0186