May 10, 2017
 
Reliance Profits Jump in First Quarter

Reliance Steel & Aluminum Co., Los Angeles, reported net income of $111.7 million in the first quarter, a 21.1 percent increase from the same period in 2016, and up 81.0 percent from the previous quarter. Net sales for North America’s largest service center company totaled $2.42 billion, an increase of 11.9 percent from first-quarter 2016 and up 17.4 percent from the fourth quarter.

“Improved demand, higher metal pricing and continued strong execution resulted in record quarterly gross profit dollars, driving our highest earnings per share and net income since the first quarter of 2012,” said President and CEO Gregg Mollins during the company’s quarterly conference call with investors and analysts.

The company’s tons sold increased 2.5 percent compared with the fourth quarter, while the average selling price per ton was up 9.7 percent. Carbon tons increased 1.5 percent to 1.2 million tons, aluminum rose 2.0 percent to 82,300 tons and stainless steel shipments increased 10.1 percent to 72,500 tons.

Among the company’s primary end markets, automotive, aerospace and heavy industry remained steady, while nonresidential construction and energy were on the rise.

Mollins said the company’s investments in value-added processing contributed to the enhanced gross profit margin, which he believes is sustainable. “We have invested approximately $1 billion in capital expenditures over the past six years, with the majority of this amount spent on value-added processing equipment. These investments far outpace our peers and, along with our decentralized operating model, provide us with a significant competitive advantage to supply our customers the highest quality products and services on a just-in-time basis.”

Reliance management remains optimistic about business activity levels in the second quarter, forecasting current demand levels to hold or show slight improvement. Tons sold are expected to be flat to up 2 percent in the quarter. “2017 is off to a great start. Both pricing and demand levels are better than they were a year ago, and we are optimistic with regard to increased infrastructure and equipment spending on the horizon,” Mollins said.


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Tuesday, October 17, 2017