PITTSBURGH — Industrial Services of America Inc. (ISA) has temporarily warm-idled its auto shredding facility due to market conditions and will focus on generating alternative grades of scrap.
Constrained ferrous volumes coupled with pricing volatility led to the immediate move to power down the equipment, the Louisville, Ky.-based metals recycler said. However, the shredder could run intermittently, it added.
The shredder was not profitable in 2014, and ISA is reviewing long-term options for the shredder and its downstream, the company said, citing an even more challenging ferrous scrap market this year than that seen in 2014.
“Management continues to work diligently to reposition ISA,” company president Sean Garber said in a statement.
“Although the ferrous market volatility has presented significant challenges, management is optimistic that the warm idling of our auto shredder will allow the company to improve operating results, while also positioning the company to implement and execute on its growth strategy,” he added.
“The company will be evaluating spot utilization of the shredder as a boutique shredding process for specialty items,” ISA said.
The company intends to focus on its metals recycling operations, equipment rental and waste services units, and auto parts business, which all demonstrated improved results in 2014.
During the warn idling, ISA will step up alternative ferrous scrap processing, including shearing and baling activities. Focusing on other types of scrap processing will allow ISA to provide scrap to customers that are seeking cut and baled grades.
“This move will allow us to focus on our operations that generate positive cash flow, which is a critical step as we position the company for financial stability and future growth opportunities,” chief financial officer Todd Phillips said in the statement.