Reliance Steel & Aluminum Co. (RS) Bundle
A Brief History of Reliance Steel & Aluminum Co.
Reliance Steel & Aluminum Co. (RS) has been a prominent player in the metals service center industry, providing a wide range of metals and related services. As of 2024, the company has a rich history marked by strategic acquisitions and consistent financial performance.
Financial Overview as of September 30, 2024
For the third quarter ended September 30, 2024, Reliance reported the following financial results:
| Metric | Q3 2024 | Q3 2023 | Change | Percentage Change |
|---|---|---|---|---|
| Net Sales | $3,420.3 million | $3,623.0 million | $(202.7 million) | (5.6%) |
| Operating Income | $273.4 million | $389.5 million | $(116.1 million) | (29.8%) |
| Net Income | $199.9 million | $296.0 million | $(96.1 million) | (32.4%) |
| Earnings per Share (Diluted) | $3.61 | $4.99 | $(1.38) | (27.6%) |
Sales Performance
For the nine months ended September 30, 2024, the company's net sales were $10,708.4 million, a decrease from $11,468.6 million in the same period of the previous year, representing a decline of 6.6%. The average selling price per ton sold decreased by 9.9% year-over-year.
Commodity Product Breakdown
The following table outlines the net sales by major commodity products for the third quarter of 2024:
| Product | Q3 2024 Sales (in millions) | Q3 2023 Sales (in millions) |
|---|---|---|
| Carbon Steel | $1,856.2 | $1,996.9 |
| Aluminum | $576.3 | $592.6 |
| Stainless Steel | $513.9 | $557.5 |
| Alloy | $155.9 | $174.4 |
| Toll Processing and Logistics | $157.1 | $154.3 |
| Copper and Brass | $78.4 | $72.2 |
| Other and Eliminations | $82.5 | $75.1 |
Acquisitions and Growth Strategy
In 2024, Reliance completed several strategic acquisitions that contributed $203.9 million to net sales. The acquisitions were aimed at enhancing capacity and diversifying product offerings.
Cash Flow and Dividends
For the nine months ended September 30, 2024, Reliance reported net cash provided by operating activities of $956.5 million, down from $1.15 billion in the same period of 2023. The company continues to return value to shareholders with cash dividends totaling $188.5 million during this period.
Stock Performance
The company has a history of consistent share repurchases, with a total of $951.3 million spent on share buybacks in the first nine months of 2024. The quarterly dividend was increased to $1.10 per share in February 2024, maintaining a strong commitment to returning capital to shareholders.
Market Position and Future Outlook
As of 2024, Reliance Steel & Aluminum Co. remains a leading entity in the metals service center sector, focusing on organic growth and strategic acquisitions to enhance its market position. The company continues to adapt to fluctuating metal prices and changing market dynamics, positioning itself for continued operational success.
A Who Owns Reliance Steel & Aluminum Co. (RS)
Overview of Ownership Structure
As of 2024, Reliance Steel & Aluminum Co. (RS) has a diverse ownership structure comprising institutional investors, mutual funds, and individual shareholders. The company's shares are primarily traded on the NYSE under the ticker symbol RS.
Top Institutional Shareholders
The following table outlines the top institutional shareholders of Reliance Steel & Aluminum Co. as of early 2024:
| Institution | Shares Held (millions) | Percentage of Total Shares |
|---|---|---|
| The Vanguard Group, Inc. | 6.5 | 9.5% |
| BlackRock, Inc. | 5.8 | 8.6% |
| State Street Corporation | 4.2 | 6.2% |
| Wellington Management Group LLP | 3.5 | 5.1% |
| Invesco Ltd. | 2.9 | 4.3% |
Major Shareholder Breakdown
As of September 30, 2024, the major shareholders of Reliance Steel & Aluminum Co. are as follows:
| Type of Shareholder | Percentage Ownership |
|---|---|
| Institutional Investors | 60% |
| Mutual Funds | 20% |
| Insider Ownership | 5% |
| Retail Investors | 15% |
Insider Ownership
Insider ownership is relatively modest, with key executives and board members holding approximately 5% of the total shares. This demonstrates a level of alignment between management and shareholder interests.
Recent Shareholder Actions
In 2024, Reliance Steel & Aluminum Co. has been active in share repurchase programs, buying back $951.3 million worth of shares in the nine months ended September 30, 2024. This is an increase from $239.2 million in the same period in 2023, indicating a strong commitment to returning capital to shareholders.
Dividend Policy
The company has maintained a consistent dividend policy, increasing its quarterly dividend from $1.00 to $1.10 per share in February 2024, marking the 31st increase since its IPO. The total cash dividends paid in the nine months ended September 30, 2024 amounted to $188.5 million, compared to $179.3 million in the same period in 2023.
Summary of Financial Performance
For the nine months ended September 30, 2024, Reliance Steel & Aluminum Co. reported net sales of $10.7 billion, down from $11.5 billion in the same period of the previous year. This decline was attributed to lower average selling prices per ton sold, which decreased by approximately 9.9%.
Shareholder Engagement
Reliance Steel & Aluminum Co. actively engages with its shareholders, holding annual meetings and providing regular updates on financial performance and strategic initiatives. The company emphasizes transparency and communication as key components of its corporate governance practices.
Reliance Steel & Aluminum Co. (RS) Mission Statement
Mission Statement Overview
The mission of Reliance Steel & Aluminum Co. (RS) emphasizes their commitment to customer satisfaction, operational excellence, and serving as a leading distributor of metals and related materials. The company aims to provide a comprehensive range of high-quality products and services while maintaining a focus on innovation and sustainability.
Key Components of the Mission Statement
- Customer Commitment: Striving to meet and exceed customer expectations through quality service and product offerings.
- Operational Excellence: Continuous improvement in operations to enhance efficiency and productivity.
- Innovation: Embracing technological advancements to improve service delivery and product offerings.
- Sustainability: Implementing practices that minimize environmental impact while maximizing resource efficiency.
Financial Performance Indicators
As of September 30, 2024, Reliance Steel & Aluminum Co. has provided key financial metrics that reflect its operational performance:
| Metric | Q3 2024 | Q3 2023 | Change |
|---|---|---|---|
| Net Sales (in millions) | $3,420.3 | $3,623.0 | $(202.7) (-5.6%) |
| Operating Income (in millions) | $273.4 | $389.5 | $(116.1) (-29.8%) |
| Net Income (in millions) | $199.2 | $295.0 | $(95.8) (-32.4%) |
| Earnings Per Share (Diluted) | $3.61 | $4.99 | $(1.38) (-27.6%) |
| Gross Profit Margin | 29.4% | 29.7% | (0.3%) |
Sales Volume and Pricing Trends
The sales volume and pricing trends for major product categories for the nine months ended September 30, 2024, are as follows:
| Product Category | Gross Sales (% of Total Sales) | Average Selling Price per Ton |
|---|---|---|
| Carbon Steel | 53% (Decrease: 9.6%) | $2,345 |
| Aluminum | 16% (Decrease: 5.9%) | $2,345 |
| Stainless Steel | 15% (Decrease: 13.8%) | $2,345 |
| Alloy | 4% (Decrease: 4.6%) | $2,345 |
Operational Metrics
For the nine months ended September 30, 2024, the operational metrics are as follows:
| Metric | 2024 | 2023 | Change |
|---|---|---|---|
| Tons Sold (in thousands) | 4,568.9 | 4,425.0 | +143.9 (+3.3%) |
| Days Sales Outstanding | 41.4 days | 40.3 days | +1.1 days |
| Inventory Turnover Rate | 4.6 times | 4.7 times | -0.1 times |
Shareholder Returns
Reliance Steel & Aluminum Co. has consistently returned value to its shareholders through dividends and share repurchases:
| Return Type | Amount (in millions) | 2024 | 2023 |
|---|---|---|---|
| Share Repurchases | $951.3 | $951.3 | $239.2 |
| Cash Dividends | $188.5 | $188.5 | $179.3 |
Dividend Policy
Reliance Steel & Aluminum Co. has a long-standing commitment to paying dividends:
- Quarterly cash dividends increased to $1.10 per share in February 2024.
- 65 consecutive years of paying dividends without reduction or suspension.
Debt and Liquidity Position
As of September 30, 2024, the company's liquidity position is as follows:
| Metric | Amount (in millions) |
|---|---|
| Cash and Cash Equivalents | $314.6 |
| Total Long-term Debt | $867.8 |
| Net Debt-to-Total Capital Ratio | 11.5% |
How Reliance Steel & Aluminum Co. (RS) Works
Business Overview
Reliance Steel & Aluminum Co. (RS) operates as a metal service center company, distributing and processing a wide range of metals. The company focuses on carbon steel, aluminum, stainless steel, and alloy products, serving various end markets. In 2024, RS has continued its strategy of acquisitions and organic growth to enhance its operational capabilities and market reach.
Financial Performance
For the third quarter and nine months ended September 30, 2024, Reliance Steel reported:
| Metric | Q3 2024 | Q3 2023 | Change | 9M 2024 | 9M 2023 | Change |
|---|---|---|---|---|---|---|
| Net Sales (in millions) | $3,420.3 | $3,623.0 | ($202.7) (-5.6%) | $10,708.4 | $11,468.6 | ($760.2) (-6.6%) |
| Gross Profit (in millions) | $1,006.3 | $1,077.0 | ($70.7) (-6.6%) | $3,220.5 | $3,525.7 | ($305.2) (-8.7%) |
| Earnings per Diluted Share | $3.61 | $4.99 | ($1.38) | $13.55 | $17.92 | ($4.37) |
| Operating Income (in millions) | $273.4 | $389.5 | ($116.1) (-29.8%) | $1,018.2 | $1,414.4 | ($396.2) (-28.0%) |
Sales Breakdown
The sales distribution by major commodity for the nine months ended September 30, 2024 is as follows:
| Commodity | Net Sales (in millions) | Percentage of Total Sales |
|---|---|---|
| Carbon Steel | $5,894.8 | 53% |
| Aluminum | $1,760.2 | 16% |
| Stainless Steel | $1,595.6 | 14% |
| Alloy | $494.6 | 5% |
| Toll Processing and Logistics | $476.1 | 4% |
| Copper and Brass | $240.7 | 2% |
| Other | $246.4 | 2% |
Operational Efficiency
Reliance Steel's operational metrics as of September 30, 2024 include:
| Metric | Q3 2024 | Q3 2023 |
|---|---|---|
| Tons Sold (in thousands) | 1,521.4 | 1,420.8 |
| Average Selling Price per Ton | $2,246 | $2,552 |
| Days Sales Outstanding | 41.4 days | 40.3 days |
| Inventory Turnover Rate | 4.6 times (2.6 months on hand) | 4.7 times (2.6 months on hand) |
Cash Flow and Investments
In terms of cash flow for the nine months ended September 30, 2024:
| Metric | Amount (in millions) |
|---|---|
| Cash Flow from Operations | $956.5 |
| Cash Used in Investing Activities | ($673.4) |
| Cash Used in Financing Activities | ($1,048.7) |
Acquisitions
In 2024, Reliance Steel completed four acquisitions totaling $366.7 million, enhancing its product breadth and processing capabilities:
- Cooksey Iron & Metal Company – Acquired on February 1, 2024.
- American Alloy Steel, Inc. – Acquired on April 1, 2024.
- Mid-West Materials, Inc. – Acquired on April 1, 2024.
- Assets of a certain company – Acquired on August 16, 2024.
Stockholder Returns
For the nine months ended September 30, 2024, Reliance Steel returned $1.14 billion to stockholders, which included:
| Type | Amount (in millions) |
|---|---|
| Share Repurchases | $951.3 |
| Cash Dividends | $188.5 |
How Reliance Steel & Aluminum Co. (RS) Makes Money
Revenue Sources
Reliance Steel & Aluminum Co. generates revenue primarily through the distribution of metals and metal products. In the nine months ended September 30, 2024, Reliance reported net sales of $10.71 billion, a decrease of 6.6% compared to $11.47 billion for the same period in 2023.
| Product Category | Net Sales (2024) | Net Sales (2023) | Change |
|---|---|---|---|
| Carbon Steel | $5.89 billion | $6.27 billion | (6.0)% |
| Aluminum | $1.76 billion | $1.90 billion | (7.0)% |
| Stainless Steel | $1.60 billion | $1.82 billion | (12.1)% |
| Alloy | $494.6 million | $552.6 million | (10.5)% |
| Toll Processing and Logistics | $476.1 million | $464.2 million | 2.0% |
| Copper and Brass | $240.7 million | $232.1 million | 3.0% |
| Other and Eliminations | $246.4 million | $231.8 million | 6.0% |
Sales Volume and Pricing Trends
For the third quarter of 2024, total tons sold reached 1.52 million, a 7.1% increase from 1.42 million tons in the same period of 2023. The average selling price per ton sold was $2,246, a decrease of 12.0% from $2,552 in the prior year.
| Metrics | Q3 2024 | Q3 2023 | Change |
|---|---|---|---|
| Total Tons Sold (in thousands) | 1,521.4 | 1,420.8 | 7.1% |
| Average Selling Price per Ton | $2,246 | $2,552 | (12.0)% |
Gross Profit and Margins
Reliance's gross profit for the nine months ended September 30, 2024, was $3.22 billion, equating to a gross profit margin of 30.1%. This reflects a decline from a gross profit of $3.53 billion and a margin of 30.7% in the same period of 2023. The decline is attributed to lower average selling prices, particularly in carbon steel, which accounted for over 50% of total sales.
| Financial Metrics | Q3 2024 | Q3 2023 |
|---|---|---|
| Gross Profit | $1.01 billion | $1.08 billion |
| Gross Profit Margin | 29.4% | 29.7% |
Operating Income and Expenses
Operating income for the nine months ended September 30, 2024, was $1.02 billion, down from $1.41 billion in 2023, marking a decrease of 28.0%. This decline is partially due to higher Selling, General and Administrative (SG&A) expenses, which reached $2.00 billion, or 18.7% of net sales.
| Operating Metrics | Q3 2024 | Q3 2023 |
|---|---|---|
| Operating Income | $273.4 million | $389.5 million |
| SG&A Expenses | $665.0 million | $626.9 million | Operating Income Margin | 8.0% | 10.8% |
Cash Flow and Returns to Shareholders
For the nine months ended September 30, 2024, Reliance generated $956.5 million in cash flow from operations, a decline from $1.15 billion in the same period in 2023. Returns to shareholders totaled $1.14 billion, comprising $951.3 million in share repurchases and $188.5 million in dividends.
| Cash Flow Metrics | 2024 | 2023 |
|---|---|---|
| Cash Flow from Operations | $956.5 million | $1.15 billion |
| Total Returns to Shareholders | $1.14 billion | $970.7 million |
| Share Repurchases | $951.3 million | $239.2 million | Dividends Paid | $188.5 million | $179.3 million |
Acquisitions
In 2024, Reliance completed four acquisitions totaling $366.7 million, enhancing its product breadth and processing capabilities. These acquisitions include:
- Cooksey Iron & Metal Company - Acquired on February 1, 2024
- American Alloy Steel, Inc. - Acquired on April 1, 2024
- Mid-West Materials, Inc. - Acquired on April 1, 2024
- Certain assets of FerrouSouth division - Acquired on August 16, 2024
These strategic acquisitions are aimed at diversifying product offerings and expanding geographic reach.
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Article updated on 8 Nov 2024
Resources:
- Reliance Steel & Aluminum Co. (RS) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Reliance Steel & Aluminum Co. (RS)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View Reliance Steel & Aluminum Co. (RS)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.