Reliance Steel & Aluminum Co. said higher steel prices contributed to lower fourth-quarter earnings that still beat expectations.

The Los Angeles metals processor on Thursday reported net income of $39.5 million (53 cents per share) compared with $92.1 million ($1.25) a year earlier. Sales rose 24 percent to $1.58 billion.

Analysts surveyed by Thomson Reuters on average expect per-share profit of 45 cents on revenue of $1.53 billion.

Results included a pretax accounting charge of $10 million. The 2009 quarter benefitted from a pretax accounting credit of $87.5 million.

Chief Executive David Hannah said demand for the company’s products was improving, and he expected growth in particular from its energy and aerospace customers. His forecast for the current quarter of earnings in a range of 90 cents to $1 per share was in line with the Wall Street consensus of 99 cents.

He did caution that rising raw material costs were a concern.

“Currently, the prices of most all the metals we sell are continuing on an upward trend,” Hannah said in a statement. “The recent rapid price increases can cause changes in our customers’ buying patterns that can make it difficult to determine what real end use demand is doing.”

Shares were up $1.14, or 2 percent, to $59.41 in Friday midday trading on the New York Stock Exchange

For reprint and licensing requests for this article, CLICK HERE.