The company said heightened concerns about the global economy led to a significant slowdown in buying patterns and a rapid decline in average selling prices during the quarter.

For the period ended Nov. 30, Schnitzer forecast per-share earnings of 18 cents to 25 cents. Analysts polled by Thomson Reuters recently projected 55 cents.

Schnitzer now expects operating earnings per ferrous ton to fall about 50% from year-earlier levels of $21 a ton in the metals recycling segment -- its largest business. In December, Schnitzer had expected operating earnings would be roughly flat with the year-earlier period.

Operating income in the auto-parts segment is expected to decline 30%.

The company's revenue had been benefiting from stronger global demand for recycled metals and higher prices, though lower margins and a higher tax rate had cut into earnings.

Schnitzer in October reported fiscal fourth-quarter earnings more than doubled as the company reported double-digit revenue growth and higher volumes and prices.

The company plans to release its fiscal first-quarter results Jan. 9.

-By Tess Stynes, Dow Jones Newswires; 212-416-2481; 
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