Metallus Inc. Soars 45.56% on Strong Shipments, Profitability

On May 12, 2025, Metallus Inc. (MTUS) experienced a significant surge in its stock price, rising by 45.56% in pre-market trading.

Metallus Inc. reported a 17% increase in overall shipments compared to the previous quarter, driven by higher industrial, automotive, and energy shipments. The company's order backlog has increased by approximately 50% from the same period a year ago, indicating strong demand. Metallus Inc. achieved a sequential improvement in profitability, with net income reaching $1.3 million and adjusted net income at $3.2 million. The company is well-positioned to capitalize on the growing demand for domestic steel, supported by strengthening spot pricing and recent market share gains. Metallus Inc. is investing $5 million in 2025 to enhance its safety management system, resulting in year-over-year improvements in all safety metrics.

However, the company faced several challenges. Aerospace and defense shipments declined sequentially due to production startup challenges faced by key customers. The company experienced unfavorable price mix during the quarter, driven by lower base prices and a higher mix of automotive and distribution shipments. Metallus Inc. faced a significant cash outflow of $38.9 million in operating cash flow, primarily due to required pension contributions. The impact of tariffs on the automotive market remains uncertain, posing potential risks to future demand. Despite improvements, the company's melt utilization rate has not yet reached its targeted level, indicating room for operational efficiency gains.

During the Q&A session, Metallus Inc. clarified that the increase in shipments was primarily due to market share gains and increased spot buys from distributors restocking their inventory after year-end, rather than pull-forward demand to get ahead of tariffs. The company expects energy product demand to continue increasing as the industry seeks domestic sourcing, moving away from heavy imports. Despite some foreign inventory overhang, particularly in Houston, Metallus Inc. anticipates growing order book demand from energy customers. Additionally, the company is making progress on commissioning difficulties faced by a new aerospace and defense facility and expects orders later this year. Metallus Inc. has also received new inquiries domestically and internationally for its munitions grades and has won several military applications, which will ramp up in the second half of the year.