Ryerson (RYZ) investor relations material

Executive summary

• Q3 revenue was $2,177.8M, net income was $32.0M, and Adjusted EBITDA excluding LIFO was $115.0M; shipments, sales, and earnings exceeded guidance.

• Same-store shipments reached their highest quarterly level in over five years; North American same-store volumes grew 8.8% in 9M versus industry growth of 5.0%.

• Annualized merger synergies reached $51.2M, exceeding the $40M first-year target ahead of schedule.

Financial highlights

• Q3 revenue rose 8.6% QoQ to $2,177.8M; shipments increased 1.2% to 814K tons, while average selling prices rose 7.2%.

• Net income attributable to shareholders was $32.0M, or $0.61 diluted EPS, versus $15.5M and $0.30 in Q2.

• Adjusted EBITDA excluding LIFO was $115.0M, up from $101.0M in Q2 and above the $88M–$92M guidance range.

• Gross margin was 17.2%, down 50 bps QoQ; adjusted gross margin excluding LIFO and purchase accounting was 18.7%, down 60 bps.

• 9M revenue was $5,750.5M and attributable net income was $52.0M; adjusted net income was $73.1M. Operating cash flow used $176.0M.

Outlook and guidance

• Q4 shipments are expected to decline 6%–8% sequentially, reflecting fewer business days and seasonality; ASPs are forecast flat to up 2%.

• Q4 net sales guidance is $1.96B–$2.04B, net income $16M–$20M, or $0.30–$0.38 per diluted share.

• Q4 Adjusted EBITDA excluding LIFO is forecast at $100M–$104M, including $28M–$30M from Olympic Steel; LIFO expense is expected at $28M–$32M.

• Q4 synergies are projected at $14M–$15M, with a $56M–$60M annualized run rate; the two-year $120M target remains in place, and year-end leverage is targeted below 3.0x.