Reliance Steel & Aluminum Tops Q2 Earnings; Expects Supply Constraints To Continue In Q3

  • Reliance Steel & Aluminum Co RS reported second-quarter net sales growth of 69.3% year-over-year and 20.4% sequentially to $3.42 billion, beating analysts consensus of $3.14 billion.
  • Adjusted EPS improved to $5.06 from $1.36 last year, beating consensus estimates of $4.73.
  • Sales by commodities: Carbon steel $2.09 billion (+95.4% Y/Y); Aluminum $498.8 million (+26.8% YY); Stainless steel $539.5 million (+60.4% Y/Y); and Alloy $134.9 million (+35% Y/Y).
  • The gross margin improved by 130 bps to 31.7% compared to a year ago and declined 190 bps sequentially.
  • The operating margin expanded by 760 bps to 13.5%.
  • Tons sold increased 1% sequentially and 17.5% Y/Y, and the average selling price per ton sold was $ 2,418 (+43.8% Y/Y and +19.7% Q/Q), experienced strong demand trends in the majority of its end markets.
  • Net cash generated by operating activities year-to-date was $263.4 million, compared to $646.5 million a year ago.
  • The company closed the quarter with cash and cash equivalents of $727.6 million, versus $222.7 million at the end of Q2'20.
  • Reliance Steel increased the existing share repurchase program to $1 billion, set to expire at the end of 2021.
  • Reliance had total debt outstanding of $1.66 billion and a net debt-to-EBITDA ratio of 0.7x.
  • Outlook: The company expects third-quarter non-GAAP EPS of $5.55 to $5.75, versus a consensus of $4.16.
  • It estimates tons sold will be down 1% to up 1% sequentially and estimates average selling price per ton sold will be up 7% to 9%.
  • It expects factors impacting shipment levels in Q2, such as metal supply constraints and supply chain disruptions, to continue to persist in Q3.
  • Price Action: RS shares are down 1.13% at $149.13 on the last check Thursday.

Posted In: BriefsEarningsNewsGuidance

Ad Disclosure: The rate information is obtained by Bankrate from the listed institutions. Bankrate cannot guaranty the accuracy or availability of any rates shown above. Institutions may have different rates on their own websites than those posted on Bankrate.com. The listings that appear on this page are from companies from which this website receives compensation, which may impact how, where, and in what order products appear. This table does not include all companies or all available products.

All rates are subject to change without notice and may vary depending on location. These quotes are from banks, thrifts, and credit unions, some of whom have paid for a link to their own Web site where you can find additional information. Those with a paid link are our Advertisers. Those without a paid link are listings we obtain to improve the consumer shopping experience and are not Advertisers. To receive the Bankrate.com rate from an Advertiser, please identify yourself as a Bankrate customer. Bank and thrift deposits are insured by the Federal Deposit Insurance Corp. Credit union deposits are insured by the National Credit Union Administration.

Consumer Satisfaction: Bankrate attempts to verify the accuracy and availability of its Advertisers' terms through its quality assurance process and requires Advertisers to agree to our Terms and Conditions and to adhere to our Quality Control Program. If you believe that you have received an inaccurate quote or are otherwise not satisfied with the services provided to you by the institution you choose, please click here.

Rate collection and criteria: Click here for more information on rate collection and criteria.