Ryerson (RYZ) Q2 2024 earnings summary

Executive summary

• Q2 2024 net income was $9.9 million, with adjusted EBITDA excluding LIFO at $42.6 million and diluted EPS of $0.29 on $1.23 billion revenue from 508,000 tons shipped; cost reductions and operational improvements offset industry headwinds.

• Operating expenses were reduced by $17.8 million sequentially, with annualized cost savings target raised to $60 million.

• Inventory was reduced by $107.1 million on a FIFO basis compared to Q1 2024.

• $20.4 million returned to shareholders via $14 million in share repurchases and $6.4 million in dividends; share repurchase authorization increased by $50 million and extended to April 2026.

• Investments in network modernization and automation continued, including University Park, IL ramp-up and Shelbyville, KY upgrades.

Financial highlights

• Q2 2024 revenue was $1.23 billion, down 1.1% sequentially and 8.8% year-over-year, driven by lower average selling prices across all product lines, partially offset by higher volumes.

• Gross margin for Q2 2024 was 18.2% (including LIFO), but excluding LIFO, contracted to 17.4%; adjusted EBITDA margin (ex-LIFO) was 3.5%.

• Net income improved from a $7.6 million loss in Q1 2024 to $9.9 million profit in Q2 2024.

• Tons shipped increased 2.2% quarter-over-quarter to 508,000; average selling price per ton was $2,412.

• Net debt at quarter-end was $497 million, up from $455 million in Q1 2024; total debt: $525 million; global liquidity at $585 million.

Outlook and guidance

• Q3 2024 shipments expected to decrease 2%–4% sequentially; average selling prices projected down 3%–5%; net sales guidance: $1.12–$1.16 billion.

• Q3 2024 adjusted EBITDA (ex-LIFO) expected between $21 million and $25 million; EPS guidance $0.01–$0.10 per diluted share.

• Management anticipates continued volatility in metals pricing and demand, with a cyclical bottoming in the second half and potential support from recent U.S. trade actions.

• Continued focus on cost reductions, working capital management, and positive operating cash flow as investment cycle concludes.