RELIANCE, INC. — Call Transcript 2025

Afternoon, everybody. My name's Albert Rialini. I work on the Jefferies Equity Research Team covering the metals and mining sector. Today, we have the pleasure of being joined by Reliance Inc. We have CEO, Carla Lewis and COO, Steven Koch. The format today is we're going open up with a brief presentation from Carla on Reliance and then we'll open it up to Q and A in the room. Alright. Thank you. Thanks, Albert and thanks to Jefferies for having us here. Tell you a little bit about our company. So at Reliance, we're a metal service center company, so primarily processing and distribution of of metals. We were founded in Los Angeles in 1939. So we've been around over eighty five years. We currently have, about three twenty locations, predominantly in The US, North America, but we do have some international locations. We've grown quite a bit over the years with a focus on being diversified, selling over 100,000 metal products to over 125,000 customers. We kind of operate ourselves, and I'll talk a little more about this as we go along, in a decentralized manner, and a lot through acquisitions. So we do keep the brand names in place and so a lot of people don't know who Reliance is. They know our From a market standpoint, they know more who are, they know more who our individual companies are that they're buying from every day. We think there's value in the companies we acquire. And we talk about our differentiated approach, we think, a little different than some of the other larger service center companies. As I mentioned, we really focus on diversification. I think we have, you know, probably the broadest product diversification. Also, we sell into most end markets. Most things, you know, use metals, have metals some part of their component and also look for that geographic, diversification. I mentioned our decentralized, operating model. We still think that we're our industry, it's more of a local business, relationships matter. We try to be close to our customers and put the decision making close to the customers. We think we can service them better and also drive our profitability a little more that way. We talk about as needed inventory, so a lot of our customers looking for small quantities quickly. We try to educate our salespeople to understand the value they're providing to their customers, not take advantage from our customers, but make sure we're charging for that and monitor our pricing and gross profit margins very closely. We generally buy in the spot, sell in the spot. We have very limited long term contract business in the where we'll do long term multiyear business is primarily in our aerospace where we the producers will lock into, multiyear sell price and so then we can lock into that with our customers. We do have some kind of quarterly pricing agreements with certain portions of our customer base, but the majority is transactional spot pricing. And, we do continue to try to grow organically. I think we've been the lead in dollars spent, with our capital expenditure budget for quite a few years now, when we're identifying our our people in the field are identifying opportunities for us to do more for our customers, and we've got the ability and the desire to, to invest in that. I talked about our diversification. So if you look at at these graphs, it kind of shows our end market, So general manufacturing, non res construction, and then transportation are three kind of major end markets, that we service with a lot of diversity selling into a lot of different customers and end markets within that, again, out by region. Commodity, we're a little over half, carbon steel and then about 15% stainless and 15% aluminum. We have toll processing as part of our business. In that business, we're it's only 4% of our sales dollars, but we're actually, processing about 6,000,000 tons of metal a year, but we don't take ownership of the metal. We're the primarily the mill owns the metal, and then we don't take on the price risk for that metal, typically selling into auto and appliance from our toll processing business. And then to the right, the byproduct, you can see that, we certainly do flat rolled in there, but carbon steel structural tubing, and plate are some of our biggest commodity items. If we move, we also, with our model, we really do focus a lot on smaller customers with small order sizes, which we think is possible because of our decentralized model. So $15,000,000,000 in revenue, dollars 3,000 average order size. We're doing a lot of transactions at our locations every day. 40% of those orders customer calls today, we deliver tomorrow. About we've grown to about 50% of our orders today have some form of value added processing performed. With that increased, value added processing that we're performing, historically, we would do about 40% of our orders, but our gross profit margins were kind of in the 25% to 27%, gross profit margin range. So we've steadily increased that and we think it's sustainable from doing more value added processing that we're now in a 29% to 31% gross profit margin range. And then more on the, financial side, our model we think allows us to have very strong and consistent cash flows even in down markets, so, somewhat of a countercyclical cash flow generation. And we've, you know, with our increased size, increased earnings, our cash flows have also expanded in recent years. And on this chart, what we're showing here is reliance in the orange, our gross profit margin pretty comparable and consistent and at the level of industrial distribution companies. And then, it's a bit above the service center peers and then the mill, peer group. And then to the right, our EBITDA margin, again towards the top, mill is doing a little better than us in recent years and we've actually started to outperform in certain periods the industrial distributors. So kind of the point here, you know, looking at us from a valuation standpoint potentially driving to a multiple closer to the industrial distribution companies. And from an investment standpoint, we like to grow, as I mentioned, kind of a leader on the CapEx side. You know, since, in the last five years or so, we've put about $1,800,000,000 into CapEx, about half of that or more every year is growth related and the majority of that going into value added processing equipment, which is allowing us to grow that gross profit margins. Also, pretty acquisitive. We've completed since our IPO in 1994, we've completed 76 acquisitions. Those are all those companies named on that earlier slide that I showed. And last year in 2024, we acquired four companies. We're always looking for good companies that we think are a good fit within Reliance, but we don't set targets because we don't wanna do a bad deal. But we think, we only represent, 16% of MSCI shipments today. It's still a very fragmented industry, so we think there's still, a lot of opportunity for us to continue to grow through acquisitions as well as organically. And then on a shareholder return perspective, we've paid regular quarterly dividends for sixty six years. We don't have a formal dividend policy, but we want to consistently increase our dividend at a sustainable level. We've never not paid our dividend and we've never reduced our dividend. So and we'd like to keep doing that going forward. And then also from a share repurchase standpoint, we opportunistically enter the market and, you know, in the last five years have repurchased about $3,200,000,000 of our shares. And, this just shows our stock price, our trading history for the last thirty one years, which, you know, we're we're proud of what we've been able to do and, look to continue to do more. So that's a little bit about Reliance. Thank you for that Carla. And if anybody does any questions, feel free to raise your hand. I will come give a mic over to you. But maybe I'll start it with, just high level on kind of the state of steel demand currently in the it seems many in the market have been waiting a while for rate cuts and maybe some more certainty with policy. But just the state of demand and if possible, if you can maybe quantify what you think is has been I guess more of the driver in terms of the increase in HRC pricing and maybe your realized pricing versus from demand or the benefit of tariffs? Yes, so I think I wish I had a really good answer to that and knew exactly what was going on. We do from a demand standpoint, I would say overall, we've seen over the last year and a half or so fairly steady overall demand levels with a little more strength in some areas than others. We do think that the uncertainty in the market due to the trade policies is holding buyers back. It's holding back business owners making decisions. We do think once people get a little more certainty and they feel more confident making those investment decisions and also when we get interest rate reductions we think that could spur a little more demand which could should help with the pricing. But Steve maybe you can talk a little more about demand. Sure. For the most part, demand has been steady for the past several quarters and non res has been driving that demand. It wouldn't be a conference without mentioning data centers. I mean, touch data centers, the construction of them and the infrastructure in and around data centers. And also, we service the health care schools, hospitals, universities, a lot of infrastructure play for bridges, tunnels, airports, rail stations. So overall, non res has been a bright spot for Reliance over the last several quarters, we look forward to servicing these markets into 2026. General manufacturing, it's been spotty. There's been some real strong spots for us, anything defense military related, machine shops or shipbuilding or submarines, etcetera. I mean, there's going to be a build up, a rebuilding of our stockpiles as far as our defense business for many, many years to come. I think we're positioned well to service those sectors. And then probably agriculture has been something that's been kind of going along the bottom for the last several quarters. We're looking forward to hopefully some change in that sector in 2026. We service auto from the toll processing point of view. We don't sell the OEMs directly, but we work with all of them and we're doing processing, whether it's aluminum or steel, and we're located near a lot of their plants and delivering just in time for them. We've seen steady demand. And we look forward to we've invested in our facilities to take care of the automotive sector, and we're positive regarding that. Any other industries? Aerospace from a commercial point of view. There's been a lot of negative news in the past several quarters, but we've actually heard some inventories being burned off and some positive anecdotal stories from some of the large Airbus and Boeing. We're positive regarding that. And defense and space has been a bright spot for us. Okay. Thank you for that. Yeah, on data center, I was at the Atlanta Steel Conference last week and that was a pretty significant takeaway of mine. It's, you know, that's I think been, you know, making up for some maybe some lost demand and with the current interest rate environment. But maybe on reshoring, I think that was another trend that was discussed a lot last week. So anything you're seeing there, evidence of that actually materializing? Yeah so from a reshoring standpoint, actually from the first Trump administration, we did see some business, some manufacturing move back to The US from mainly Southeast Asia. Not in a big way, but there were definite some of our customers started making components for their customers here as opposed to it being done overseas. So there was already some momentum that discussions continued obviously coming out of COVID and bringing your supply chains closer. A lot of investment and planned investment in Mexico by a lot of our customers. And so we think that's real and it had started. Now, especially the beginning of this year, we heard from almost all of our businesses that their customers were talking to them much more about bringing their supply chains, bringing production back to The U. S, potentially Mexico. I don't think anyone thought that the uncertainty with Canada and Mexico would last as long as it has. So I think that's holding back a lot of our customers from actually kicking off their investments, whether it ends up being in The U. S. Or Mexico until they feel there's a little more certainty there. But definitely, a lot of people talking about it and I think Steve can share some examples of of, you know, real investment that we've already seen. Yeah. So we've seen obviously a lot of reinvestments in the chip industry down in Texas and Arizona. Automotive, we've seen some platforms move from Mexico and Canada to The United States. They're adding shifts automotive is adding shifts to a lot of their plants. And also we've seen a lot of pharmaceutical reshoring where research and development and actually production of drugs being moved to The United States for security purposes and other purposes. So Karl, you mentioned the uncertainty with tariffs, especially Canada and Mexico. I think on primary steelmaking, it's kind of easy to maybe understand how tariffs would benefit a primary steelmaker here in The U. S. But I guess maybe if you could walk through how tariffs benefit or maybe they don't benefit your business? And just how do you yeah, the impact there? I mean, generally a better balance between supply and demand is supportive of higher pricing levels and with less import and we've seen this since 2018 with less imported material coming in, it's given the domestic mills the opportunity to increase prices. Generally, you know, we're able to pass those higher prices on to our customers. Obviously, we have to be fair, to our customers when we're doing that, but they understand the model and so it gives us higher prices, higher earnings dollars. So, we think that overall for the industry, tariffs in the past have been, supportive to our industry. Also I think you know Reliance, we have a long history of buying domestic product. Over 95% of what we buy, we buy from The US producers, so we have strong positions with them. So we have access to the metal and already have, you know, those relationships built so customers know they can come to us. You know, I think there has been, some shifting. There are some, you know, service centers out there whose model historically has been to bring in a lot of import material and even some customers who would bring import in direct and they've had to find a new source for that. We've seen our market share, our shipments increasing and outpacing the industry shipment levels. We think some of that's part of the reason and the domestic mills who we're very close with are also picking up some of that share from import and we like to partner with them and grow with them. So those are some of the positives that we look at. Okay. And then maybe just a quick follow-up there. So on the primary steelmaking side, I think some of the major producers, there's a bit of an offsetting negative with Canada and Mexico being involved, given some of them have operations there, have invested there, given kind of the intertwining of the North American industry since, I think it was 2020 when they were originally given exemption. So anything to call out there in terms of your business dealings in Canada and Mexico? I'm not sure if you touched on maybe how much of your earnings are derived from sales there or? Yeah so for us it's pretty limited. In Mexico we have some toll processing operations there and their business has held up. It's actually doing really well, primarily automotive tolling. And we have lot of customers, as I mentioned earlier, with operations down there. We haven't seen a significant impact and it's still a fairly small part of our business, I think more of it was planning for the future. We do have some operations in Canada, again, a fairly small footprint. We used to supply them from kind of one of our hub locations in The US, and so they've had to they're bringing in less of that metal and having to find different supply sources. But, you know, again, for for us directly, you know, it's been pretty limited. Understand a lot of other supply chains are a little more disrupted, but I don't want to speak for any of the producers. If anyone in the room has a question, feel free to just raise your hand. But I guess, maybe moving more towards the longer term impact of tariffs. So I think in 2018 when Trump first enacted them, I think the response from the primary steelmaking industry was to invest in new capacity. And you're starting to see that capacity come online this year, next year. And I think it maybe has painted a little bit of an unfavorable kind of market balance unless you do have tariffs on. So just curious, was there a similar response from the service center side of things in 2018? Was there a lot of investment in new capacity in the industry or? No. I mean, I think people are in the service industry you know always looking for growth opportunities and you know we've done a few greenfields but I wouldn't say that was you know tariff related. Maybe people were more profitable and so they had higher cash flow to be able to invest a little more in growth. But in our growth and investments at the service center level, If we do a greenfield today it might cost 30,000,000 to $40,000,000 The mills, the producers, they're going billions of dollars. So we can do a lot of incremental growth without the type of capacity increase that you see at the producer level. Okay. And I think a follow-up to that would be, so I think this time around and it's definitely a takeaway from last week, that you won't kind of see that same response from the domestic producers, obviously, given the supply outlook. And I think another reason is because you're starting to see how competent foreign producers are going to get on tariffed access to The US markets with Nippon's purchase of U. S. Steel and then Hyundai's commitment to the new, I think it is 6,500,000,000.0 tons billion dollar for 3,500,000, maybe, tons into the 2030s. So I guess how does investment like that from foreign producers and more and more I guess domestic capacity, how would that impact you guys in the longer term? And I guess your margins. Yeah, I guess be careful here. Again as I said earlier, kind of the we like a good supply demand balance. It's better for all of us. And as you mentioned there has been domestic mills have increased their capacity here in the last few years. That's coming online. And I guess from our space timing works with the import restrictions that that new domestic capacity could replace the metal that was coming in from foreign sources and that would keep us in better balance. I think we're good. I don't think we need more investment in U. S. Capacity in the steel space, at least not in the near term. But I don't get to make those decisions, but I probably would have made different decisions. And then just last one on tariffs from me. If maybe you could just talk about how the impact on the aluminum side has been, if if really any different. I know, obviously, we produce much more steel here in The US than we do primary aluminum and if that's been kind of a different impact with tariffs. Yeah, mean the tariffs hit the Midwest premium pretty hard, pretty quickly. So, you know, we've been, you know, paying the mill increases and trying to pass it through, but we're trying to also work with our customers and make sure that there's not demand destruction and work with them through their challenges. And we're in it for the long run. And we certainly support U. S. Manufacturing, but we also support our customer base. Okay. So I guess maybe diving more into some company specifics. Obviously, M and A has been kind of part of your DNA over the past few decades. I think I've read over 75 acquisitions. I guess what's your kind of approach there? I mean how do you look at kind of market valuations currently? Do you I is, guess, the period now, just given the elevated volatility, I guess, less favorable for M and A activity in your space? Yes. So Reliance, we have grown quite a bit over the years, especially in our earlier years when we were building out our footprint. Our approach on acquisitions is we like to buy good, well run companies, strong management teams, immediately accretive to earnings. And a lot of times and just with the complexion of our industry it's a lot of like family owned businesses, maybe single to a few locations. And their model's a little more like ours where it's really locally focused, customer service, next day delivery and those have been kind of the best additions, to our portfolio. We have done three larger acquisitions, you know, back in 02/2006, Earl M. Jorgensen, they were a public company at the time, about a billion dollar, transaction. Then the P and A group that had public debt that was kind of a conglomerate of of some different metals companies and, again, about a billion and a half. And then our largest acquisition 13 was Metals USA at about $2,000,000,000 enterprise value, which had also been a roll up that had gone public. So those are good acquisitions for us. Timing wasn't always great, especially on our 2008 acquisition. But they were good long term investments that we've been really happy with. But then we buy, as I said, a lot of these family owned companies. And the approach is in our decentralized entrepreneurial model to let them continue to generally operate the way they have under their brand. We paid a premium because they were a good company so we want them to continue that. But we think we can bring resources whether through capital or people or just market knowledge to help them get better. We've had a pretty consistent valuation methodology over the years. We try to and especially today, a lot of these companies when we're looking at them to acquire them, we understand metal prices go up and down, we understand end markets are cyclical and generally we probably have a business that sells similar products into similar end markets so we know what the cycles were. So we look at their historical numbers, we really don't look at projections, and we try to say you know what do we think a normalized level of earnings would be for this company going forward? We buy them for the long term, we're not looking to strip them and flip them, we want them to be part of the family going forward and we don't value any synergies into that number, we think those belong to us. So we come up with that normalized EBITDA number and then apply a multiple to that and then hope that the seller agrees with us that that's a fair number, you know, for them. I think from where our you know, we are seeing typically what we've seen over the years is when there's uncertainty or an unfavorable market, the sellers kind of hold back because they think they're going to get paid a lower price for their business. And then when there's more confidence, a little more certainty, we see more people come to the market. We try to explain that with the way we value, we're not taking advantage of market cycles, but that's kind of the general psyche I think. So we did see a little pullback in opportunities I think going into the election last fall that lasted through the beginning of this year. But we've seen a lot more teasers and just more companies that we're aware of have come to market in the second quarter. So there's activity out there. We will look at it and hopefully find some good companies that fit and execute. Valuations, there was, in our view, a big disconnect, coming out of like 'twenty one, 'twenty two, 'twenty three. We thought we saw, you know, expectations become more aligned with the way we look at things. And as I mentioned, we were able to complete four acquisitions last year. Right now we anticipate more reasonable expectations, although I think there was and hopefully this wasn't you, Rick, we saw one, recently where we like the business, but we don't know why someone was willing to pay, you know, the multiple they're paying for that company and, we said good for the sellers. So but we think that we'll continue to see activity. Thank you for the detail there. You touched on the capital return policy. Just so I heard it correctly, so it's a fixed dividend or was that right there? So it's a quarterly dividend and we've generally increased it annually. Okay. And is the are the buybacks I know they were more than $1,000,000,000 last year are those a cash flow based payout, an earnings based payout, or just kind of based on the cash you have at hand and maybe where you see the market going? Yeah. It's really us just opportunistically accessing the market. We don't have again anything formal. Being in a business where there's metal price volatility and cyclical end markets, We like to keep flexibility on our balance sheet. We're opportunistic when we go after acquisitions, our CapEx, what do our customers need from us. So we want to have that flexibility. But then we also look at share repurchases opportunistically as well. We've been fortunate with our good cash flow the last few years that we've been able to really execute on all four of those capital allocation buckets. We haven't had to pull back on any one to do something else, so we haven't been held back on share repurchases. We've just accessed the market in the manner that we felt was best suited to provide value to our shareholders while at the same time not having to limit anything on the acquisition or organic growth side. Okay. I think just maybe going maybe a little bit more back to the macro. Just with the current administration, everyone talks about tariffs, especially in this space. But aside from tariffs and the onshoring initiatives, any other, I guess, changes that you've seen that have affected your business under the current administration? Like I know on the mining side of things, companies we cover have seen permitting drastically So I'm just curious, anything else you guys seen under the current administration? Yeah, and we really try not to get into politics and voice any views. But there has been some rollback of regulation that I think is good for business overall. You know certainly the bonus depreciation that was enacted that's good for reliance directly from a cash flow perspective but also I think helpful to spur other investments. I would say nothing else too direct for us there. Just for someone who's really new to your story, could you just walk me through what kind of allowed for your EPS to essentially double over the last five years? And could you parse out, like, say, this amount is from inorganic contribution, certain amount from margin improvement, that sort of thing, just for that historical context? I'm not going to be able to do that very well for you, sorry. But I mean really we've just had a continued focus on growing the business both with organic, inorganic. It's probably been a little more even. We used to years ago be more heavily weighted towards acquisitions. But it's been probably a little more even on those two fronts. We also have just encouraged our businesses to go after a little more market share, making sure it's good profitable business, don't go after everything but be a little more aggressive and we set some targets on that. But I think the biggest factor is really just the underlying metal cost. We are significantly impacted by the price of metal on our earnings level. But also since 2018 coming out of COVID, we think structurally metal prices are higher. All of our costs went up at the producer level, the service center level at our customer level. So I think you know we think it's a step up in higher pricing model which we're generating higher earnings dollars, higher cash flow, our investments in value add processing kind of mitigating some of that metal price risk. But I can't point to one thing or really parse out, but metal prices would probably be the biggest driver. I think we're out of time. I wanted to thank Carl and Steven for a very nice presentation and I'm sure you could follow-up myself or Carl and Steven after. Thank you. Thank you. Thank you.

Speaker 1: Afternoon, everybody. My name's Albert Rialini. I work on the Jefferies Equity Research Team covering the metals and mining sector. Today, we have the pleasure of being joined by Reliance Inc. We have CEO, Carla Lewis and COO, Steven Koch. Afternoon, everybody. afternoon everybody My name's Albert Rialini. my name's albert rialini I work on the Jefferies Equity Research Team covering the metals and mining sector. i work on the jefferies equity research team covering the metals and mining sector Today, we have the pleasure of being joined by Reliance Inc. today we have the pleasure of being joined by reliance inc We have CEO, Carla Lewis and COO, Steven Koch. we have ceo carla lewis and coo steven koch The format today is we're going open up with a brief presentation from Carla on Reliance and then we'll open it up to Q and A in the room. The format today is we're going open up with a brief presentation from Carla on Reliance and then we'll open it up to Q and A in the room. the format today is we're going open up with a brief presentation from carla on reliance and then we'll open it up to q and a in the room

Speaker 2: Alright. Thank you. Thanks, Albert and thanks to Jefferies for having us here. Tell you a little bit about our company. So at Reliance, we're a metal service center company, so primarily processing and distribution of of metals. Alright. alright Thank you. thank you Thanks, Albert and thanks to Jefferies for having us here. thanks albert and thanks to jefferies for having us here Tell you a little bit about our company. tell you a little bit about our company So at Reliance, we're a metal service center company, so primarily processing and distribution of of metals. so at reliance we're a metal service center company so primarily processing and distribution of of metals We were founded in Los Angeles in 1939. So we've been around over eighty five years. We currently have, about three twenty locations, predominantly in The US, North America, but we do have some international locations. We've grown quite a bit over the years with a focus on being diversified, selling over 100,000 metal products to over 125,000 customers. We kind of operate ourselves, and I'll talk a little more about this as we go along, in a decentralized manner, and a lot through acquisitions. We were founded in Los Angeles in 1939. we were founded in los angeles in 1939 So we've been around over eighty five years. so we've been around over eighty five years We currently have, about three twenty locations, predominantly in The US, North America, but we do have some international locations. we currently have about three twenty locations predominantly in the us north america but we do have some international locations We've grown quite a bit over the years with a focus on being diversified, selling over 100,000 metal products to over 125,000 customers. we've grown quite a bit over the years with a focus on being diversified selling over 100,000 metal products to over 125,000 customers We kind of operate ourselves, and I'll talk a little more about this as we go along, in a decentralized manner, and a lot through acquisitions. we kind of operate ourselves and i'll talk a little more about this as we go along in a decentralized manner and a lot through acquisitions So we do keep the brand names in place and so a lot of people don't know who Reliance is. They know our From a market standpoint, they know more who are, they know more who our individual companies are that they're buying from every day. We think there's value in the companies we acquire. And we talk about our differentiated approach, we think, a little different than some of the other larger service center companies. As I mentioned, we really focus on diversification. So we do keep the brand names in place and so a lot of people don't know who Reliance is. so we do keep the brand names in place and so a lot of people don't know who reliance is They know our From a market standpoint, they know more who are, they know more who our individual companies are that they're buying from every day. they know our from a market standpoint they know more who are they know more who our individual companies are that they're buying from every day We think there's value in the companies we acquire. we think there's value in the companies we acquire And we talk about our differentiated approach, we think, a little different than some of the other larger service center companies. and we talk about our differentiated approach we think a little different than some of the other larger service center companies As I mentioned, we really focus on diversification. as i mentioned we really focus on diversification I think we have, you know, probably the broadest product diversification. Also, we sell into most end markets. Most things, you know, use metals, have metals some part of their component and also look for that geographic, diversification. I mentioned our decentralized, operating model. We still think that we're our industry, it's more of a local business, relationships matter. I think we have, you know, probably the broadest product diversification. i think we have you know probably the broadest product diversification Also, we sell into most end markets. also we sell into most end markets Most things, you know, use metals, have metals some part of their component and also look for that geographic, diversification. most things you know use metals have metals some part of their component and also look for that geographic diversification I mentioned our decentralized, operating model. i mentioned our decentralized operating model We still think that we're our industry, it's more of a local business, relationships matter. we still think that we're our industry it's more of a local business relationships matter We try to be close to our customers and put the decision making close to the customers. We think we can service them better and also drive our profitability a little more that way. We talk about as needed inventory, so a lot of our customers looking for small quantities quickly. We try to educate our salespeople to understand the value they're providing to their customers, not take advantage from our customers, but make sure we're charging for that and monitor our pricing and gross profit margins very closely. We generally buy in the spot, sell in the spot. We try to be close to our customers and put the decision making close to the customers. we try to be close to our customers and put the decision making close to the customers We think we can service them better and also drive our profitability a little more that way. we think we can service them better and also drive our profitability a little more that way We talk about as needed inventory, so a lot of our customers looking for small quantities quickly. we talk about as needed inventory so a lot of our customers looking for small quantities quickly We try to educate our salespeople to understand the value they're providing to their customers, not take advantage from our customers, but make sure we're charging for that and monitor our pricing and gross profit margins very closely. we try to educate our salespeople to understand the value they're providing to their customers not take advantage from our customers but make sure we're charging for that and monitor our pricing and gross profit margins very closely We generally buy in the spot, sell in the spot. we generally buy in the spot sell in the spot We have very limited long term contract business in the where we'll do long term multiyear business is primarily in our aerospace where we the producers will lock into, multiyear sell price and so then we can lock into that with our customers. We do have some kind of quarterly pricing agreements with certain portions of our customer base, but the majority is transactional spot pricing. And, we do continue to try to grow organically. I think we've been the lead in dollars spent, with our capital expenditure budget for quite a few years now, when we're identifying our our people in the field are identifying opportunities for us to do more for our customers, and we've got the ability and the desire to, to invest in that. I talked about our diversification. We have very limited long term contract business in the where we'll do long term multiyear business is primarily in our aerospace where we the producers will lock into, multiyear sell price and so then we can lock into that with our customers. we have very limited long term contract business in the where we'll do long term multiyear business is primarily in our aerospace where we the producers will lock into multiyear sell price and so then we can lock into that with our customers We do have some kind of quarterly pricing agreements with certain portions of our customer base, but the majority is transactional spot pricing. we do have some kind of quarterly pricing agreements with certain portions of our customer base but the majority is transactional spot pricing And, we do continue to try to grow organically. and we do continue to try to grow organically I think we've been the lead in dollars spent, with our capital expenditure budget for quite a few years now, when we're identifying our our people in the field are identifying opportunities for us to do more for our customers, and we've got the ability and the desire to, to invest in that. i think we've been the lead in dollars spent with our capital expenditure budget for quite a few years now when we're identifying our our people in the field are identifying opportunities for us to do more for our customers and we've got the ability and the desire to to invest in that I talked about our diversification. i talked about our diversification So if you look at at these graphs, it kind of shows our end market, So general manufacturing, non res construction, and then transportation are three kind of major end markets, that we service with a lot of diversity selling into a lot of different customers and end markets within that, again, out by region. Commodity, we're a little over half, carbon steel and then about 15% stainless and 15% aluminum. We have toll processing as part of our business. In that business, we're it's only 4% of our sales dollars, but we're actually, processing about 6,000,000 tons of metal a year, but we don't take ownership of the metal. We're the primarily the mill owns the metal, and then we don't take on the price risk for that metal, typically selling into auto and appliance from our toll processing business. So if you look at at these graphs, it kind of shows our end market, So general manufacturing, non res construction, and then transportation are three kind of major end markets, that we service with a lot of diversity selling into a lot of different customers and end markets within that, again, out by region. so if you look at at these graphs it kind of shows our end market so general manufacturing non res construction and then transportation are three kind of major end markets that we service with a lot of diversity selling into a lot of different customers and end markets within that again out by region Commodity, we're a little over half, carbon steel and then about 15% stainless and 15% aluminum. commodity we're a little over half carbon steel and then about 15% stainless and 15% aluminum We have toll processing as part of our business. we have toll processing as part of our business In that business, we're it's only 4% of our sales dollars, but we're actually, processing about 6,000,000 tons of metal a year, but we don't take ownership of the metal. in that business we're it's only 4% of our sales dollars but we're actually processing about 6,000,000 tons of metal a year but we don't take ownership of the metal We're the primarily the mill owns the metal, and then we don't take on the price risk for that metal, typically selling into auto and appliance from our toll processing business. we're the primarily the mill owns the metal and then we don't take on the price risk for that metal typically selling into auto and appliance from our toll processing business And then to the right, the byproduct, you can see that, we certainly do flat rolled in there, but carbon steel structural tubing, and plate are some of our biggest commodity items. If we move, we also, with our model, we really do focus a lot on smaller customers with small order sizes, which we think is possible because of our decentralized model. So $15,000,000,000 in revenue, dollars 3,000 average order size. We're doing a lot of transactions at our locations every day. 40% of those orders customer calls today, we deliver tomorrow. And then to the right, the byproduct, you can see that, we certainly do flat rolled in there, but carbon steel structural tubing, and plate are some of our biggest commodity items. and then to the right the byproduct you can see that we certainly do flat rolled in there but carbon steel structural tubing and plate are some of our biggest commodity items If we move, we also, with our model, we really do focus a lot on smaller customers with small order sizes, which we think is possible because of our decentralized model. if we move we also with our model we really do focus a lot on smaller customers with small order sizes which we think is possible because of our decentralized model So $15,000,000,000 in revenue, dollars 3,000 average order size. so $15,000,000,000 in revenue dollars 3,000 average order size We're doing a lot of transactions at our locations every day. we're doing a lot of transactions at our locations every day 40% of those orders customer calls today, we deliver tomorrow. 40% of those orders customer calls today we deliver tomorrow About we've grown to about 50% of our orders today have some form of value added processing performed. With that increased, value added processing that we're performing, historically, we would do about 40% of our orders, but our gross profit margins were kind of in the 25% to 27%, gross profit margin range. So we've steadily increased that and we think it's sustainable from doing more value added processing that we're now in a 29% to 31% gross profit margin range. And then more on the, financial side, our model we think allows us to have very strong and consistent cash flows even in down markets, so, somewhat of a countercyclical cash flow generation. And we've, you know, with our increased size, increased earnings, our cash flows have also expanded in recent years. About we've grown to about 50% of our orders today have some form of value added processing performed. about we've grown to about 50% of our orders today have some form of value added processing performed With that increased, value added processing that we're performing, historically, we would do about 40% of our orders, but our gross profit margins were kind of in the 25% to 27%, gross profit margin range. with that increased value added processing that we're performing historically we would do about 40% of our orders but our gross profit margins were kind of in the 25% to 27% gross profit margin range So we've steadily increased that and we think it's sustainable from doing more value added processing that we're now in a 29% to 31% gross profit margin range. so we've steadily increased that and we think it's sustainable from doing more value added processing that we're now in a 29% to 31% gross profit margin range And then more on the, financial side, our model we think allows us to have very strong and consistent cash flows even in down markets, so, somewhat of a countercyclical cash flow generation. and then more on the financial side our model we think allows us to have very strong and consistent cash flows even in down markets so somewhat of a countercyclical cash flow generation And we've, you know, with our increased size, increased earnings, our cash flows have also expanded in recent years. and we've you know with our increased size increased earnings our cash flows have also expanded in recent years And on this chart, what we're showing here is reliance in the orange, our gross profit margin pretty comparable and consistent and at the level of industrial distribution companies. And then, it's a bit above the service center peers and then the mill, peer group. And then to the right, our EBITDA margin, again towards the top, mill is doing a little better than us in recent years and we've actually started to outperform in certain periods the industrial distributors. So kind of the point here, you know, looking at us from a valuation standpoint potentially driving to a multiple closer to the industrial distribution companies. And from an investment standpoint, we like to grow, as I mentioned, kind of a leader on the CapEx side. And on this chart, what we're showing here is reliance in the orange, our gross profit margin pretty comparable and consistent and at the level of industrial distribution companies. and on this chart what we're showing here is reliance in the orange our gross profit margin pretty comparable and consistent and at the level of industrial distribution companies And then, it's a bit above the service center peers and then the mill, peer group. and then it's a bit above the service center peers and then the mill peer group And then to the right, our EBITDA margin, again towards the top, mill is doing a little better than us in recent years and we've actually started to outperform in certain periods the industrial distributors. and then to the right our ebitda margin again towards the top mill is doing a little better than us in recent years and we've actually started to outperform in certain periods the industrial distributors So kind of the point here, you know, looking at us from a valuation standpoint potentially driving to a multiple closer to the industrial distribution companies. so kind of the point here you know looking at us from a valuation standpoint potentially driving to a multiple closer to the industrial distribution companies And from an investment standpoint, we like to grow, as I mentioned, kind of a leader on the CapEx side. and from an investment standpoint we like to grow as i mentioned kind of a leader on the capex side You know, since, in the last five years or so, we've put about $1,800,000,000 into CapEx, about half of that or more every year is growth related and the majority of that going into value added processing equipment, which is allowing us to grow that gross profit margins. Also, pretty acquisitive. We've completed since our IPO in 1994, we've completed 76 acquisitions. Those are all those companies named on that earlier slide that I showed. And last year in 2024, we acquired four companies. You know, since, in the last five years or so, we've put about $1,800,000,000 into CapEx, about half of that or more every year is growth related and the majority of that going into value added processing equipment, which is allowing us to grow that gross profit margins. you know since in the last five years or so we've put about $1,800,000,000 into capex about half of that or more every year is growth related and the majority of that going into value added processing equipment which is allowing us to grow that gross profit margins Also, pretty acquisitive. also pretty acquisitive We've completed since our IPO in 1994, we've completed 76 acquisitions. we've completed since our ipo in 1994 we've completed 76 acquisitions Those are all those companies named on that earlier slide that I showed. those are all those companies named on that earlier slide that i showed And last year in 2024, we acquired four companies. and last year in 2024 we acquired four companies We're always looking for good companies that we think are a good fit within Reliance, but we don't set targets because we don't wanna do a bad deal. But we think, we only represent, 16% of MSCI shipments today. It's still a very fragmented industry, so we think there's still, a lot of opportunity for us to continue to grow through acquisitions as well as organically. And then on a shareholder return perspective, we've paid regular quarterly dividends for sixty six years. We don't have a formal dividend policy, but we want to consistently increase our dividend at a sustainable level. We're always looking for good companies that we think are a good fit within Reliance, but we don't set targets because we don't wanna do a bad deal. we're always looking for good companies that we think are a good fit within reliance but we don't set targets because we don't wanna do a bad deal But we think, we only represent, 16% of MSCI shipments today. but we think we only represent 16% of msci shipments today It's still a very fragmented industry, so we think there's still, a lot of opportunity for us to continue to grow through acquisitions as well as organically. it's still a very fragmented industry so we think there's still a lot of opportunity for us to continue to grow through acquisitions as well as organically And then on a shareholder return perspective, we've paid regular quarterly dividends for sixty six years. and then on a shareholder return perspective we've paid regular quarterly dividends for sixty six years We don't have a formal dividend policy, but we want to consistently increase our dividend at a sustainable level. we don't have a formal dividend policy but we want to consistently increase our dividend at a sustainable level We've never not paid our dividend and we've never reduced our dividend. So and we'd like to keep doing that going forward. And then also from a share repurchase standpoint, we opportunistically enter the market and, you know, in the last five years have repurchased about $3,200,000,000 of our shares. And, this just shows our stock price, our trading history for the last thirty one years, which, you know, we're we're proud of what we've been able to do and, look to continue to do more. So that's a little bit about Reliance. We've never not paid our dividend and we've never reduced our dividend. we've never not paid our dividend and we've never reduced our dividend So and we'd like to keep doing that going forward. so and we'd like to keep doing that going forward And then also from a share repurchase standpoint, we opportunistically enter the market and, you know, in the last five years have repurchased about $3,200,000,000 of our shares. and then also from a share repurchase standpoint we opportunistically enter the market and you know in the last five years have repurchased about $3,200,000,000 of our shares And, this just shows our stock price, our trading history for the last thirty one years, which, you know, we're we're proud of what we've been able to do and, look to continue to do more. and this just shows our stock price our trading history for the last thirty one years which you know we're we're proud of what we've been able to do and look to continue to do more So that's a little bit about Reliance. so that's a little bit about reliance

Speaker 1: Thank you for that Carla. And if anybody does any questions, feel free to raise your hand. I will come give a mic over to you. But maybe I'll start it with, just high level on kind of the state of steel demand currently in the it seems many in the market have been waiting a while for rate cuts and maybe some more certainty with policy. But just the state of demand and if possible, if you can maybe quantify what you think is has been I guess more of the driver in terms of the increase in HRC pricing and maybe your realized pricing versus from demand or the benefit of tariffs? Thank you for that Carla. thank you for that carla And if anybody does any questions, feel free to raise your hand. and if anybody does any questions feel free to raise your hand I will come give a mic over to you. i will come give a mic over to you But maybe I'll start it with, just high level on kind of the state of steel demand currently in the it seems many in the market have been waiting a while for rate cuts and maybe some more certainty with policy. but maybe i'll start it with just high level on kind of the state of steel demand currently in the it seems many in the market have been waiting a while for rate cuts and maybe some more certainty with policy But just the state of demand and if possible, if you can maybe quantify what you think is has been I guess more of the driver in terms of the increase in HRC pricing and maybe your realized pricing versus from demand or the benefit of tariffs? but just the state of demand and if possible if you can maybe quantify what you think is has been i guess more of the driver in terms of the increase in hrc pricing and maybe your realized pricing versus from demand or the benefit of tariffs

Speaker 2: Yes, so I think I wish I had a really good answer to that and knew exactly what was going on. We do from a demand standpoint, I would say overall, we've seen over the last year and a half or so fairly steady overall demand levels with a little more strength in some areas than others. We do think that the uncertainty in the market due to the trade policies is holding buyers back. It's holding back business owners making decisions. We do think once people get a little more certainty and they feel more confident making those investment decisions and also when we get interest rate reductions we think that could spur a little more demand which could should help with the pricing. Yes, so I think I wish I had a really good answer to that and knew exactly what was going on. yes so i think i wish i had a really good answer to that and knew exactly what was going on We do from a demand standpoint, I would say overall, we've seen over the last year and a half or so fairly steady overall demand levels with a little more strength in some areas than others. we do from a demand standpoint i would say overall we've seen over the last year and a half or so fairly steady overall demand levels with a little more strength in some areas than others We do think that the uncertainty in the market due to the trade policies is holding buyers back. we do think that the uncertainty in the market due to the trade policies is holding buyers back It's holding back business owners making decisions. it's holding back business owners making decisions We do think once people get a little more certainty and they feel more confident making those investment decisions and also when we get interest rate reductions we think that could spur a little more demand which could should help with the pricing. we do think once people get a little more certainty and they feel more confident making those investment decisions and also when we get interest rate reductions we think that could spur a little more demand which could should help with the pricing But Steve maybe you can talk a little more about demand. But Steve maybe you can talk a little more about demand. but steve maybe you can talk a little more about demand

Speaker 3: Sure. For the most part, demand has been steady for the past several quarters and non res has been driving that demand. It wouldn't be a conference without mentioning data centers. I mean, touch data centers, the construction of them and the infrastructure in and around data centers. And also, we service the health care schools, hospitals, universities, a lot of infrastructure play for bridges, tunnels, airports, rail stations. Sure. sure For the most part, demand has been steady for the past several quarters and non res has been driving that demand. for the most part demand has been steady for the past several quarters and non res has been driving that demand It wouldn't be a conference without mentioning data centers. it wouldn't be a conference without mentioning data centers I mean, touch data centers, the construction of them and the infrastructure in and around data centers. i mean touch data centers the construction of them and the infrastructure in and around data centers And also, we service the health care schools, hospitals, universities, a lot of infrastructure play for bridges, tunnels, airports, rail stations. and also we service the health care schools hospitals universities a lot of infrastructure play for bridges tunnels airports rail stations So overall, non res has been a bright spot for Reliance over the last several quarters, we look forward to servicing these markets into 2026. General manufacturing, it's been spotty. There's been some real strong spots for us, anything defense military related, machine shops or shipbuilding or submarines, etcetera. I mean, there's going to be a build up, a rebuilding of our stockpiles as far as our defense business for many, many years to come. I think we're positioned well to service those sectors. So overall, non res has been a bright spot for Reliance over the last several quarters, we look forward to servicing these markets into 2026. so overall non res has been a bright spot for reliance over the last several quarters we look forward to servicing these markets into 2026 General manufacturing, it's been spotty. general manufacturing it's been spotty There's been some real strong spots for us, anything defense military related, machine shops or shipbuilding or submarines, etcetera. there's been some real strong spots for us anything defense military related machine shops or shipbuilding or submarines etcetera I mean, there's going to be a build up, a rebuilding of our stockpiles as far as our defense business for many, many years to come. i mean there's going to be a build up a rebuilding of our stockpiles as far as our defense business for many many years to come I think we're positioned well to service those sectors. i think we're positioned well to service those sectors And then probably agriculture has been something that's been kind of going along the bottom for the last several quarters. We're looking forward to hopefully some change in that sector in 2026. We service auto from the toll processing point of view. We don't sell the OEMs directly, but we work with all of them and we're doing processing, whether it's aluminum or steel, and we're located near a lot of their plants and delivering just in time for them. We've seen steady demand. And then probably agriculture has been something that's been kind of going along the bottom for the last several quarters. and then probably agriculture has been something that's been kind of going along the bottom for the last several quarters We're looking forward to hopefully some change in that sector in 2026. we're looking forward to hopefully some change in that sector in 2026 We service auto from the toll processing point of view. we service auto from the toll processing point of view We don't sell the OEMs directly, but we work with all of them and we're doing processing, whether it's aluminum or steel, and we're located near a lot of their plants and delivering just in time for them. we don't sell the oems directly but we work with all of them and we're doing processing whether it's aluminum or steel and we're located near a lot of their plants and delivering just in time for them We've seen steady demand. we've seen steady demand And we look forward to we've invested in our facilities to take care of the automotive sector, and we're positive regarding that. Any other industries? Aerospace from a commercial point of view. There's been a lot of negative news in the past several quarters, but we've actually heard some inventories being burned off and some positive anecdotal stories from some of the large Airbus and Boeing. We're positive regarding that. And we look forward to we've invested in our facilities to take care of the automotive sector, and we're positive regarding that. and we look forward to we've invested in our facilities to take care of the automotive sector and we're positive regarding that Any other industries? any other industries Aerospace from a commercial point of view. aerospace from a commercial point of view There's been a lot of negative news in the past several quarters, but we've actually heard some inventories being burned off and some positive anecdotal stories from some of the large Airbus and Boeing. there's been a lot of negative news in the past several quarters but we've actually heard some inventories being burned off and some positive anecdotal stories from some of the large airbus and boeing We're positive regarding that. we're positive regarding that And defense and space has been a bright spot for us. And defense and space has been a bright spot for us. and defense and space has been a bright spot for us

Speaker 1: Okay. Thank you for that. Yeah, on data center, I was at the Atlanta Steel Conference last week and that was a pretty significant takeaway of mine. It's, you know, that's I think been, you know, making up for some maybe some lost demand and with the current interest rate environment. But maybe on reshoring, I think that was another trend that was discussed a lot last week. Okay. okay Thank you for that. thank you for that Yeah, on data center, I was at the Atlanta Steel Conference last week and that was a pretty significant takeaway of mine. yeah on data center i was at the atlanta steel conference last week and that was a pretty significant takeaway of mine It's, you know, that's I think been, you know, making up for some maybe some lost demand and with the current interest rate environment. it's you know that's i think been you know making up for some maybe some lost demand and with the current interest rate environment But maybe on reshoring, I think that was another trend that was discussed a lot last week. but maybe on reshoring i think that was another trend that was discussed a lot last week So anything you're seeing there, evidence of that actually materializing? So anything you're seeing there, evidence of that actually materializing? so anything you're seeing there evidence of that actually materializing

Speaker 2: Yeah so from a reshoring standpoint, actually from the first Trump administration, we did see some business, some manufacturing move back to The US from mainly Southeast Asia. Not in a big way, but there were definite some of our customers started making components for their customers here as opposed to it being done overseas. So there was already some momentum that discussions continued obviously coming out of COVID and bringing your supply chains closer. A lot of investment and planned investment in Mexico by a lot of our customers. And so we think that's real and it had started. Yeah so from a reshoring standpoint, actually from the first Trump administration, we did see some business, some manufacturing move back to The US from mainly Southeast Asia. yeah so from a reshoring standpoint actually from the first trump administration we did see some business some manufacturing move back to the us from mainly southeast asia Not in a big way, but there were definite some of our customers started making components for their customers here as opposed to it being done overseas. not in a big way but there were definite some of our customers started making components for their customers here as opposed to it being done overseas So there was already some momentum that discussions continued obviously coming out of COVID and bringing your supply chains closer. so there was already some momentum that discussions continued obviously coming out of covid and bringing your supply chains closer A lot of investment and planned investment in Mexico by a lot of our customers. a lot of investment and planned investment in mexico by a lot of our customers And so we think that's real and it had started. and so we think that's real and it had started Now, especially the beginning of this year, we heard from almost all of our businesses that their customers were talking to them much more about bringing their supply chains, bringing production back to The U. S, potentially Mexico. I don't think anyone thought that the uncertainty with Canada and Mexico would last as long as it has. So I think that's holding back a lot of our customers from actually kicking off their investments, whether it ends up being in The U. S. Now, especially the beginning of this year, we heard from almost all of our businesses that their customers were talking to them much more about bringing their supply chains, bringing production back to The U. now especially the beginning of this year we heard from almost all of our businesses that their customers were talking to them much more about bringing their supply chains bringing production back to the u S, potentially Mexico. s potentially mexico I don't think anyone thought that the uncertainty with Canada and Mexico would last as long as it has. i don't think anyone thought that the uncertainty with canada and mexico would last as long as it has So I think that's holding back a lot of our customers from actually kicking off their investments, whether it ends up being in The U. so i think that's holding back a lot of our customers from actually kicking off their investments whether it ends up being in the u S. s Or Mexico until they feel there's a little more certainty there. But definitely, a lot of people talking about it and I think Steve can share some examples of of, you know, real investment that we've already seen. Or Mexico until they feel there's a little more certainty there. or mexico until they feel there's a little more certainty there But definitely, a lot of people talking about it and I think Steve can share some examples of of, you know, real investment that we've already seen. but definitely a lot of people talking about it and i think steve can share some examples of of you know real investment that we've already seen

Speaker 3: Yeah. So we've seen obviously a lot of reinvestments in the chip industry down in Texas and Arizona. Automotive, we've seen some platforms move from Mexico and Canada to The United States. They're adding shifts automotive is adding shifts to a lot of their plants. And also we've seen a lot of pharmaceutical reshoring where research and development and actually production of drugs being moved to The United States for security purposes and other purposes. Yeah. yeah So we've seen obviously a lot of reinvestments in the chip industry down in Texas and Arizona. so we've seen obviously a lot of reinvestments in the chip industry down in texas and arizona Automotive, we've seen some platforms move from Mexico and Canada to The United States. automotive we've seen some platforms move from mexico and canada to the united states They're adding shifts automotive is adding shifts to a lot of their plants. they're adding shifts automotive is adding shifts to a lot of their plants And also we've seen a lot of pharmaceutical reshoring where research and development and actually production of drugs being moved to The United States for security purposes and other purposes. and also we've seen a lot of pharmaceutical reshoring where research and development and actually production of drugs being moved to the united states for security purposes and other purposes

Speaker 1: So Karl, you mentioned the uncertainty with tariffs, especially Canada and Mexico. I think on primary steelmaking, it's kind of easy to maybe understand how tariffs would benefit a primary steelmaker here in The U. S. But I guess maybe if you could walk through how tariffs benefit or maybe they don't benefit your business? And just how do you yeah, the impact there? So Karl, you mentioned the uncertainty with tariffs, especially Canada and Mexico. so karl you mentioned the uncertainty with tariffs especially canada and mexico I think on primary steelmaking, it's kind of easy to maybe understand how tariffs would benefit a primary steelmaker here in The U. i think on primary steelmaking it's kind of easy to maybe understand how tariffs would benefit a primary steelmaker here in the u S. s But I guess maybe if you could walk through how tariffs benefit or maybe they don't benefit your business? but i guess maybe if you could walk through how tariffs benefit or maybe they don't benefit your business And just how do you yeah, the impact there? and just how do you yeah the impact there

Speaker 2: I mean, generally a better balance between supply and demand is supportive of higher pricing levels and with less import and we've seen this since 2018 with less imported material coming in, it's given the domestic mills the opportunity to increase prices. Generally, you know, we're able to pass those higher prices on to our customers. Obviously, we have to be fair, to our customers when we're doing that, but they understand the model and so it gives us higher prices, higher earnings dollars. So, we think that overall for the industry, tariffs in the past have been, supportive to our industry. Also I think you know Reliance, we have a long history of buying domestic product. I mean, generally a better balance between supply and demand is supportive of higher pricing levels and with less import and we've seen this since 2018 with less imported material coming in, it's given the domestic mills the opportunity to increase prices. i mean generally a better balance between supply and demand is supportive of higher pricing levels and with less import and we've seen this since 2018 with less imported material coming in it's given the domestic mills the opportunity to increase prices Generally, you know, we're able to pass those higher prices on to our customers. generally you know we're able to pass those higher prices on to our customers Obviously, we have to be fair, to our customers when we're doing that, but they understand the model and so it gives us higher prices, higher earnings dollars. obviously we have to be fair to our customers when we're doing that but they understand the model and so it gives us higher prices higher earnings dollars So, we think that overall for the industry, tariffs in the past have been, supportive to our industry. so we think that overall for the industry tariffs in the past have been supportive to our industry Also I think you know Reliance, we have a long history of buying domestic product. also i think you know reliance we have a long history of buying domestic product Over 95% of what we buy, we buy from The US producers, so we have strong positions with them. So we have access to the metal and already have, you know, those relationships built so customers know they can come to us. You know, I think there has been, some shifting. There are some, you know, service centers out there whose model historically has been to bring in a lot of import material and even some customers who would bring import in direct and they've had to find a new source for that. We've seen our market share, our shipments increasing and outpacing the industry shipment levels. Over 95% of what we buy, we buy from The US producers, so we have strong positions with them. over 95% of what we buy we buy from the us producers so we have strong positions with them So we have access to the metal and already have, you know, those relationships built so customers know they can come to us. so we have access to the metal and already have you know those relationships built so customers know they can come to us You know, I think there has been, some shifting. you know i think there has been some shifting There are some, you know, service centers out there whose model historically has been to bring in a lot of import material and even some customers who would bring import in direct and they've had to find a new source for that. there are some you know service centers out there whose model historically has been to bring in a lot of import material and even some customers who would bring import in direct and they've had to find a new source for that We've seen our market share, our shipments increasing and outpacing the industry shipment levels. we've seen our market share our shipments increasing and outpacing the industry shipment levels We think some of that's part of the reason and the domestic mills who we're very close with are also picking up some of that share from import and we like to partner with them and grow with them. So those are some of the positives that we look at. We think some of that's part of the reason and the domestic mills who we're very close with are also picking up some of that share from import and we like to partner with them and grow with them. we think some of that's part of the reason and the domestic mills who we're very close with are also picking up some of that share from import and we like to partner with them and grow with them So those are some of the positives that we look at. so those are some of the positives that we look at

Speaker 1: Okay. And then maybe just a quick follow-up there. So on the primary steelmaking side, I think some of the major producers, there's a bit of an offsetting negative with Canada and Mexico being involved, given some of them have operations there, have invested there, given kind of the intertwining of the North American industry since, I think it was 2020 when they were originally given exemption. So anything to call out there in terms of your business dealings in Canada and Mexico? I'm not sure if you touched on maybe how much of your earnings are derived from sales there or? Okay. okay And then maybe just a quick follow-up there. and then maybe just a quick follow-up there So on the primary steelmaking side, I think some of the major producers, there's a bit of an offsetting negative with Canada and Mexico being involved, given some of them have operations there, have invested there, given kind of the intertwining of the North American industry since, I think it was 2020 when they were originally given exemption. so on the primary steelmaking side i think some of the major producers there's a bit of an offsetting negative with canada and mexico being involved given some of them have operations there have invested there given kind of the intertwining of the north american industry since i think it was 2020 when they were originally given exemption So anything to call out there in terms of your business dealings in Canada and Mexico? so anything to call out there in terms of your business dealings in canada and mexico I'm not sure if you touched on maybe how much of your earnings are derived from sales there or? i'm not sure if you touched on maybe how much of your earnings are derived from sales there or

Speaker 2: Yeah so for us it's pretty limited. In Mexico we have some toll processing operations there and their business has held up. It's actually doing really well, primarily automotive tolling. And we have lot of customers, as I mentioned earlier, with operations down there. We haven't seen a significant impact and it's still a fairly small part of our business, I think more of it was planning for the future. Yeah so for us it's pretty limited. yeah so for us it's pretty limited In Mexico we have some toll processing operations there and their business has held up. in mexico we have some toll processing operations there and their business has held up It's actually doing really well, primarily automotive tolling. it's actually doing really well primarily automotive tolling And we have lot of customers, as I mentioned earlier, with operations down there. and we have lot of customers as i mentioned earlier with operations down there We haven't seen a significant impact and it's still a fairly small part of our business, I think more of it was planning for the future. we haven't seen a significant impact and it's still a fairly small part of our business i think more of it was planning for the future We do have some operations in Canada, again, a fairly small footprint. We used to supply them from kind of one of our hub locations in The US, and so they've had to they're bringing in less of that metal and having to find different supply sources. But, you know, again, for for us directly, you know, it's been pretty limited. Understand a lot of other supply chains are a little more disrupted, but I don't want to speak for any of the producers. We do have some operations in Canada, again, a fairly small footprint. we do have some operations in canada again a fairly small footprint We used to supply them from kind of one of our hub locations in The US, and so they've had to they're bringing in less of that metal and having to find different supply sources. we used to supply them from kind of one of our hub locations in the us and so they've had to they're bringing in less of that metal and having to find different supply sources But, you know, again, for for us directly, you know, it's been pretty limited. but you know again for for us directly you know it's been pretty limited Understand a lot of other supply chains are a little more disrupted, but I don't want to speak for any of the producers. understand a lot of other supply chains are a little more disrupted but i don't want to speak for any of the producers

Speaker 1: If anyone in the room has a question, feel free to just raise your hand. But I guess, maybe moving more towards the longer term impact of tariffs. So I think in 2018 when Trump first enacted them, I think the response from the primary steelmaking industry was to invest in new capacity. And you're starting to see that capacity come online this year, next year. And I think it maybe has painted a little bit of an unfavorable kind of market balance unless you do have tariffs on. If anyone in the room has a question, feel free to just raise your hand. if anyone in the room has a question feel free to just raise your hand But I guess, maybe moving more towards the longer term impact of tariffs. but i guess maybe moving more towards the longer term impact of tariffs So I think in 2018 when Trump first enacted them, I think the response from the primary steelmaking industry was to invest in new capacity. so i think in 2018 when trump first enacted them i think the response from the primary steelmaking industry was to invest in new capacity And you're starting to see that capacity come online this year, next year. and you're starting to see that capacity come online this year next year And I think it maybe has painted a little bit of an unfavorable kind of market balance unless you do have tariffs on. and i think it maybe has painted a little bit of an unfavorable kind of market balance unless you do have tariffs on So just curious, was there a similar response from the service center side of things in 2018? Was there a lot of investment in new capacity in the industry or? So just curious, was there a similar response from the service center side of things in 2018? so just curious was there a similar response from the service center side of things in 2018 Was there a lot of investment in new capacity in the industry or? was there a lot of investment in new capacity in the industry or

Speaker 2: No. I mean, I think people are in the service industry you know always looking for growth opportunities and you know we've done a few greenfields but I wouldn't say that was you know tariff related. Maybe people were more profitable and so they had higher cash flow to be able to invest a little more in growth. But in our growth and investments at the service center level, If we do a greenfield today it might cost 30,000,000 to $40,000,000 The mills, the producers, they're going billions of dollars. So we can do a lot of incremental growth without the type of capacity increase that you see at the producer level. No. no I mean, I think people are in the service industry you know always looking for growth opportunities and you know we've done a few greenfields but I wouldn't say that was you know tariff related. i mean i think people are in the service industry you know always looking for growth opportunities and you know we've done a few greenfields but i wouldn't say that was you know tariff related Maybe people were more profitable and so they had higher cash flow to be able to invest a little more in growth. maybe people were more profitable and so they had higher cash flow to be able to invest a little more in growth But in our growth and investments at the service center level, If we do a greenfield today it might cost 30,000,000 to $40,000,000 The mills, the producers, they're going billions of dollars. but in our growth and investments at the service center level if we do a greenfield today it might cost 30,000,000 to $40,000,000 the mills the producers they're going billions of dollars So we can do a lot of incremental growth without the type of capacity increase that you see at the producer level. so we can do a lot of incremental growth without the type of capacity increase that you see at the producer level

Speaker 1: Okay. And I think a follow-up to that would be, so I think this time around and it's definitely a takeaway from last week, that you won't kind of see that same response from the domestic producers, obviously, given the supply outlook. And I think another reason is because you're starting to see how competent foreign producers are going to get on tariffed access to The US markets with Nippon's purchase of U. S. Steel and then Hyundai's commitment to the new, I think it is 6,500,000,000.0 tons billion dollar for 3,500,000, maybe, tons into the 2030s. Okay. okay And I think a follow-up to that would be, so I think this time around and it's definitely a takeaway from last week, that you won't kind of see that same response from the domestic producers, obviously, given the supply outlook. and i think a follow-up to that would be so i think this time around and it's definitely a takeaway from last week that you won't kind of see that same response from the domestic producers obviously given the supply outlook And I think another reason is because you're starting to see how competent foreign producers are going to get on tariffed access to The US markets with Nippon's purchase of U. and i think another reason is because you're starting to see how competent foreign producers are going to get on tariffed access to the us markets with nippon's purchase of u S. s Steel and then Hyundai's commitment to the new, I think it is 6,500,000,000.0 tons billion dollar for 3,500,000, maybe, tons into the 2030s. steel and then hyundai's commitment to the new i think it is 6,500,000,000.0 tons billion dollar for 3,500,000 maybe tons into the 2030s So I guess how does investment like that from foreign producers and more and more I guess domestic capacity, how would that impact you guys in the longer term? And I guess your margins. So I guess how does investment like that from foreign producers and more and more I guess domestic capacity, how would that impact you guys in the longer term? so i guess how does investment like that from foreign producers and more and more i guess domestic capacity how would that impact you guys in the longer term And I guess your margins. and i guess your margins

Speaker 2: Yeah, I guess be careful here. Again as I said earlier, kind of the we like a good supply demand balance. It's better for all of us. And as you mentioned there has been domestic mills have increased their capacity here in the last few years. That's coming online. Yeah, I guess be careful here. yeah i guess be careful here Again as I said earlier, kind of the we like a good supply demand balance. again as i said earlier kind of the we like a good supply demand balance It's better for all of us. it's better for all of us And as you mentioned there has been domestic mills have increased their capacity here in the last few years. and as you mentioned there has been domestic mills have increased their capacity here in the last few years That's coming online. that's coming online And I guess from our space timing works with the import restrictions that that new domestic capacity could replace the metal that was coming in from foreign sources and that would keep us in better balance. I think we're good. I don't think we need more investment in U. S. Capacity in the steel space, at least not in the near term. And I guess from our space timing works with the import restrictions that that new domestic capacity could replace the metal that was coming in from foreign sources and that would keep us in better balance. and i guess from our space timing works with the import restrictions that that new domestic capacity could replace the metal that was coming in from foreign sources and that would keep us in better balance I think we're good. i think we're good I don't think we need more investment in U. i don't think we need more investment in u S. s Capacity in the steel space, at least not in the near term. capacity in the steel space at least not in the near term But I don't get to make those decisions, but I probably would have made different decisions. But I don't get to make those decisions, but I probably would have made different decisions. but i don't get to make those decisions but i probably would have made different decisions

Speaker 1: And then just last one on tariffs from me. If maybe you could just talk about how the impact on the aluminum side has been, if if really any different. I know, obviously, we produce much more steel here in The US than we do primary aluminum and if that's been kind of a different impact with tariffs. And then just last one on tariffs from me. and then just last one on tariffs from me If maybe you could just talk about how the impact on the aluminum side has been, if if really any different. if maybe you could just talk about how the impact on the aluminum side has been if if really any different I know, obviously, we produce much more steel here in The US than we do primary aluminum and if that's been kind of a different impact with tariffs. i know obviously we produce much more steel here in the us than we do primary aluminum and if that's been kind of a different impact with tariffs

Speaker 3: Yeah, mean the tariffs hit the Midwest premium pretty hard, pretty quickly. So, you know, we've been, you know, paying the mill increases and trying to pass it through, but we're trying to also work with our customers and make sure that there's not demand destruction and work with them through their challenges. And we're in it for the long run. And we certainly support U. S. Manufacturing, but we also support our customer base. Yeah, mean the tariffs hit the Midwest premium pretty hard, pretty quickly. yeah mean the tariffs hit the midwest premium pretty hard pretty quickly So, you know, we've been, you know, paying the mill increases and trying to pass it through, but we're trying to also work with our customers and make sure that there's not demand destruction and work with them through their challenges. so you know we've been you know paying the mill increases and trying to pass it through but we're trying to also work with our customers and make sure that there's not demand destruction and work with them through their challenges And we're in it for the long run. and we're in it for the long run And we certainly support U. and we certainly support u S. s Manufacturing, but we also support our customer base. manufacturing but we also support our customer base

Speaker 1: Okay. So I guess maybe diving more into some company specifics. Obviously, M and A has been kind of part of your DNA over the past few decades. I think I've read over 75 acquisitions. I guess what's your kind of approach there? Okay. okay So I guess maybe diving more into some company specifics. so i guess maybe diving more into some company specifics Obviously, M and A has been kind of part of your DNA over the past few decades. obviously m and a has been kind of part of your dna over the past few decades I think I've read over 75 acquisitions. i think i've read over 75 acquisitions I guess what's your kind of approach there? i guess what's your kind of approach there I mean how do you look at kind of market valuations currently? Do you I is, guess, the period now, just given the elevated volatility, I guess, less favorable for M and A activity in your space? I mean how do you look at kind of market valuations currently? i mean how do you look at kind of market valuations currently Do you I is, guess, the period now, just given the elevated volatility, I guess, less favorable for M and A activity in your space? do you i is guess the period now just given the elevated volatility i guess less favorable for m and a activity in your space

Speaker 2: Yes. So Reliance, we have grown quite a bit over the years, especially in our earlier years when we were building out our footprint. Our approach on acquisitions is we like to buy good, well run companies, strong management teams, immediately accretive to earnings. And a lot of times and just with the complexion of our industry it's a lot of like family owned businesses, maybe single to a few locations. And their model's a little more like ours where it's really locally focused, customer service, next day delivery and those have been kind of the best additions, to our portfolio. Yes. yes So Reliance, we have grown quite a bit over the years, especially in our earlier years when we were building out our footprint. so reliance we have grown quite a bit over the years especially in our earlier years when we were building out our footprint Our approach on acquisitions is we like to buy good, well run companies, strong management teams, immediately accretive to earnings. our approach on acquisitions is we like to buy good well run companies strong management teams immediately accretive to earnings And a lot of times and just with the complexion of our industry it's a lot of like family owned businesses, maybe single to a few locations. and a lot of times and just with the complexion of our industry it's a lot of like family owned businesses maybe single to a few locations And their model's a little more like ours where it's really locally focused, customer service, next day delivery and those have been kind of the best additions, to our portfolio. and their model's a little more like ours where it's really locally focused customer service next day delivery and those have been kind of the best additions to our portfolio We have done three larger acquisitions, you know, back in 02/2006, Earl M. Jorgensen, they were a public company at the time, about a billion dollar, transaction. Then the P and A group that had public debt that was kind of a conglomerate of of some different metals companies and, again, about a billion and a half. And then our largest acquisition 13 was Metals USA at about $2,000,000,000 enterprise value, which had also been a roll up that had gone public. So those are good acquisitions for us. We have done three larger acquisitions, you know, back in 02/2006, Earl M. we have done three larger acquisitions you know back in 02/2006 earl m Jorgensen, they were a public company at the time, about a billion dollar, transaction. jorgensen they were a public company at the time about a billion dollar transaction Then the P and A group that had public debt that was kind of a conglomerate of of some different metals companies and, again, about a billion and a half. then the p and a group that had public debt that was kind of a conglomerate of of some different metals companies and again about a billion and a half And then our largest acquisition 13 was Metals USA at about $2,000,000,000 enterprise value, which had also been a roll up that had gone public. and then our largest acquisition 13 was metals usa at about $2,000,000,000 enterprise value which had also been a roll up that had gone public So those are good acquisitions for us. so those are good acquisitions for us Timing wasn't always great, especially on our 2008 acquisition. But they were good long term investments that we've been really happy with. But then we buy, as I said, a lot of these family owned companies. And the approach is in our decentralized entrepreneurial model to let them continue to generally operate the way they have under their brand. We paid a premium because they were a good company so we want them to continue that. Timing wasn't always great, especially on our 2008 acquisition. timing wasn't always great especially on our 2008 acquisition But they were good long term investments that we've been really happy with. but they were good long term investments that we've been really happy with But then we buy, as I said, a lot of these family owned companies. but then we buy as i said a lot of these family owned companies And the approach is in our decentralized entrepreneurial model to let them continue to generally operate the way they have under their brand. and the approach is in our decentralized entrepreneurial model to let them continue to generally operate the way they have under their brand We paid a premium because they were a good company so we want them to continue that. we paid a premium because they were a good company so we want them to continue that But we think we can bring resources whether through capital or people or just market knowledge to help them get better. We've had a pretty consistent valuation methodology over the years. We try to and especially today, a lot of these companies when we're looking at them to acquire them, we understand metal prices go up and down, we understand end markets are cyclical and generally we probably have a business that sells similar products into similar end markets so we know what the cycles were. So we look at their historical numbers, we really don't look at projections, and we try to say you know what do we think a normalized level of earnings would be for this company going forward? We buy them for the long term, we're not looking to strip them and flip them, we want them to be part of the family going forward and we don't value any synergies into that number, we think those belong to us. But we think we can bring resources whether through capital or people or just market knowledge to help them get better. but we think we can bring resources whether through capital or people or just market knowledge to help them get better We've had a pretty consistent valuation methodology over the years. we've had a pretty consistent valuation methodology over the years We try to and especially today, a lot of these companies when we're looking at them to acquire them, we understand metal prices go up and down, we understand end markets are cyclical and generally we probably have a business that sells similar products into similar end markets so we know what the cycles were. we try to and especially today a lot of these companies when we're looking at them to acquire them we understand metal prices go up and down we understand end markets are cyclical and generally we probably have a business that sells similar products into similar end markets so we know what the cycles were So we look at their historical numbers, we really don't look at projections, and we try to say you know what do we think a normalized level of earnings would be for this company going forward? so we look at their historical numbers we really don't look at projections and we try to say you know what do we think a normalized level of earnings would be for this company going forward We buy them for the long term, we're not looking to strip them and flip them, we want them to be part of the family going forward and we don't value any synergies into that number, we think those belong to us. we buy them for the long term we're not looking to strip them and flip them we want them to be part of the family going forward and we don't value any synergies into that number we think those belong to us So we come up with that normalized EBITDA number and then apply a multiple to that and then hope that the seller agrees with us that that's a fair number, you know, for them. I think from where our you know, we are seeing typically what we've seen over the years is when there's uncertainty or an unfavorable market, the sellers kind of hold back because they think they're going to get paid a lower price for their business. And then when there's more confidence, a little more certainty, we see more people come to the market. We try to explain that with the way we value, we're not taking advantage of market cycles, but that's kind of the general psyche I think. So we did see a little pullback in opportunities I think going into the election last fall that lasted through the beginning of this year. So we come up with that normalized EBITDA number and then apply a multiple to that and then hope that the seller agrees with us that that's a fair number, you know, for them. so we come up with that normalized ebitda number and then apply a multiple to that and then hope that the seller agrees with us that that's a fair number you know for them I think from where our you know, we are seeing typically what we've seen over the years is when there's uncertainty or an unfavorable market, the sellers kind of hold back because they think they're going to get paid a lower price for their business. i think from where our you know we are seeing typically what we've seen over the years is when there's uncertainty or an unfavorable market the sellers kind of hold back because they think they're going to get paid a lower price for their business And then when there's more confidence, a little more certainty, we see more people come to the market. and then when there's more confidence a little more certainty we see more people come to the market We try to explain that with the way we value, we're not taking advantage of market cycles, but that's kind of the general psyche I think. we try to explain that with the way we value we're not taking advantage of market cycles but that's kind of the general psyche i think So we did see a little pullback in opportunities I think going into the election last fall that lasted through the beginning of this year. so we did see a little pullback in opportunities i think going into the election last fall that lasted through the beginning of this year But we've seen a lot more teasers and just more companies that we're aware of have come to market in the second quarter. So there's activity out there. We will look at it and hopefully find some good companies that fit and execute. Valuations, there was, in our view, a big disconnect, coming out of like 'twenty one, 'twenty two, 'twenty three. We thought we saw, you know, expectations become more aligned with the way we look at things. But we've seen a lot more teasers and just more companies that we're aware of have come to market in the second quarter. but we've seen a lot more teasers and just more companies that we're aware of have come to market in the second quarter So there's activity out there. so there's activity out there We will look at it and hopefully find some good companies that fit and execute. we will look at it and hopefully find some good companies that fit and execute Valuations, there was, in our view, a big disconnect, coming out of like 'twenty one, 'twenty two, 'twenty three. valuations there was in our view a big disconnect coming out of like 'twenty one 'twenty two 'twenty three We thought we saw, you know, expectations become more aligned with the way we look at things. we thought we saw you know expectations become more aligned with the way we look at things And as I mentioned, we were able to complete four acquisitions last year. Right now we anticipate more reasonable expectations, although I think there was and hopefully this wasn't you, Rick, we saw one, recently where we like the business, but we don't know why someone was willing to pay, you know, the multiple they're paying for that company and, we said good for the sellers. So but we think that we'll continue to see activity. And as I mentioned, we were able to complete four acquisitions last year. and as i mentioned we were able to complete four acquisitions last year Right now we anticipate more reasonable expectations, although I think there was and hopefully this wasn't you, Rick, we saw one, recently where we like the business, but we don't know why someone was willing to pay, you know, the multiple they're paying for that company and, we said good for the sellers. right now we anticipate more reasonable expectations although i think there was and hopefully this wasn't you rick we saw one recently where we like the business but we don't know why someone was willing to pay you know the multiple they're paying for that company and we said good for the sellers So but we think that we'll continue to see activity. so but we think that we'll continue to see activity

Speaker 1: Thank you for the detail there. You touched on the capital return policy. Just so I heard it correctly, so it's a fixed dividend or was that right there? Thank you for the detail there. thank you for the detail there You touched on the capital return policy. you touched on the capital return policy Just so I heard it correctly, so it's a fixed dividend or was that right there? just so i heard it correctly so it's a fixed dividend or was that right there

Speaker 2: So it's a quarterly dividend and we've generally increased it annually. So it's a quarterly dividend and we've generally increased it annually. so it's a quarterly dividend and we've generally increased it annually

Speaker 1: Okay. And is the are the buybacks I know they were more than $1,000,000,000 last year are those a cash flow based payout, an earnings based payout, or just kind of based on the cash you have at hand and maybe where you see the market going? Okay. okay And is the are the buybacks I know they were more than $1,000,000,000 last year are those a cash flow based payout, an earnings based payout, or just kind of based on the cash you have at hand and maybe where you see the market going? and is the are the buybacks i know they were more than $1,000,000,000 last year are those a cash flow based payout an earnings based payout or just kind of based on the cash you have at hand and maybe where you see the market going

Speaker 2: Yeah. It's really us just opportunistically accessing the market. We don't have again anything formal. Being in a business where there's metal price volatility and cyclical end markets, We like to keep flexibility on our balance sheet. We're opportunistic when we go after acquisitions, our CapEx, what do our customers need from us. Yeah. yeah It's really us just opportunistically accessing the market. it's really us just opportunistically accessing the market We don't have again anything formal. we don't have again anything formal Being in a business where there's metal price volatility and cyclical end markets, We like to keep flexibility on our balance sheet. being in a business where there's metal price volatility and cyclical end markets we like to keep flexibility on our balance sheet We're opportunistic when we go after acquisitions, our CapEx, what do our customers need from us. we're opportunistic when we go after acquisitions our capex what do our customers need from us So we want to have that flexibility. But then we also look at share repurchases opportunistically as well. We've been fortunate with our good cash flow the last few years that we've been able to really execute on all four of those capital allocation buckets. We haven't had to pull back on any one to do something else, so we haven't been held back on share repurchases. We've just accessed the market in the manner that we felt was best suited to provide value to our shareholders while at the same time not having to limit anything on the acquisition or organic growth side. So we want to have that flexibility. so we want to have that flexibility But then we also look at share repurchases opportunistically as well. but then we also look at share repurchases opportunistically as well We've been fortunate with our good cash flow the last few years that we've been able to really execute on all four of those capital allocation buckets. we've been fortunate with our good cash flow the last few years that we've been able to really execute on all four of those capital allocation buckets We haven't had to pull back on any one to do something else, so we haven't been held back on share repurchases. we haven't had to pull back on any one to do something else so we haven't been held back on share repurchases We've just accessed the market in the manner that we felt was best suited to provide value to our shareholders while at the same time not having to limit anything on the acquisition or organic growth side. we've just accessed the market in the manner that we felt was best suited to provide value to our shareholders while at the same time not having to limit anything on the acquisition or organic growth side

Speaker 1: Okay. I think just maybe going maybe a little bit more back to the macro. Just with the current administration, everyone talks about tariffs, especially in this space. But aside from tariffs and the onshoring initiatives, any other, I guess, changes that you've seen that have affected your business under the current administration? Like I know on the mining side of things, companies we cover have seen permitting drastically Okay. okay I think just maybe going maybe a little bit more back to the macro. i think just maybe going maybe a little bit more back to the macro Just with the current administration, everyone talks about tariffs, especially in this space. just with the current administration everyone talks about tariffs especially in this space But aside from tariffs and the onshoring initiatives, any other, I guess, changes that you've seen that have affected your business under the current administration? but aside from tariffs and the onshoring initiatives any other i guess changes that you've seen that have affected your business under the current administration Like I know on the mining side of things, companies we cover have seen permitting drastically like i know on the mining side of things companies we cover have seen permitting drastically So I'm just curious, anything else you guys seen under the current administration? So I'm just curious, anything else you guys seen under the current administration? so i'm just curious anything else you guys seen under the current administration

Speaker 2: Yeah, and we really try not to get into politics and voice any views. But there has been some rollback of regulation that I think is good for business overall. You know certainly the bonus depreciation that was enacted that's good for reliance directly from a cash flow perspective but also I think helpful to spur other investments. I would say nothing else too direct for us Yeah, and we really try not to get into politics and voice any views. yeah and we really try not to get into politics and voice any views But there has been some rollback of regulation that I think is good for business overall. but there has been some rollback of regulation that i think is good for business overall You know certainly the bonus depreciation that was enacted that's good for reliance directly from a cash flow perspective but also I think helpful to spur other investments. you know certainly the bonus depreciation that was enacted that's good for reliance directly from a cash flow perspective but also i think helpful to spur other investments I would say nothing else too direct for us i would say nothing else too direct for us

Speaker 1: there. there. there

Speaker 4: Just for someone who's really new to your story, could you just walk me through what kind of allowed for your EPS to essentially double over the last five years? And could you parse out, like, say, this amount is from inorganic contribution, certain amount from margin improvement, that sort of thing, just for that historical context? Just for someone who's really new to your story, could you just walk me through what kind of allowed for your EPS to essentially double over the last five years? just for someone who's really new to your story could you just walk me through what kind of allowed for your eps to essentially double over the last five years And could you parse out, like, say, this amount is from inorganic contribution, certain amount from margin improvement, that sort of thing, just for that historical context? and could you parse out like say this amount is from inorganic contribution certain amount from margin improvement that sort of thing just for that historical context

Speaker 2: I'm not going to be able to do that very well for you, sorry. But I mean really we've just had a continued focus on growing the business both with organic, inorganic. It's probably been a little more even. We used to years ago be more heavily weighted towards acquisitions. But it's been probably a little more even on those two fronts. I'm not going to be able to do that very well for you, sorry. i'm not going to be able to do that very well for you sorry But I mean really we've just had a continued focus on growing the business both with organic, inorganic. but i mean really we've just had a continued focus on growing the business both with organic inorganic It's probably been a little more even. it's probably been a little more even We used to years ago be more heavily weighted towards acquisitions. we used to years ago be more heavily weighted towards acquisitions But it's been probably a little more even on those two fronts. but it's been probably a little more even on those two fronts We also have just encouraged our businesses to go after a little more market share, making sure it's good profitable business, don't go after everything but be a little more aggressive and we set some targets on that. But I think the biggest factor is really just the underlying metal cost. We are significantly impacted by the price of metal on our earnings level. But also since 2018 coming out of COVID, we think structurally metal prices are higher. All of our costs went up at the producer level, the service center level at our customer level. We also have just encouraged our businesses to go after a little more market share, making sure it's good profitable business, don't go after everything but be a little more aggressive and we set some targets on that. we also have just encouraged our businesses to go after a little more market share making sure it's good profitable business don't go after everything but be a little more aggressive and we set some targets on that But I think the biggest factor is really just the underlying metal cost. but i think the biggest factor is really just the underlying metal cost We are significantly impacted by the price of metal on our earnings level. we are significantly impacted by the price of metal on our earnings level But also since 2018 coming out of COVID, we think structurally metal prices are higher. but also since 2018 coming out of covid we think structurally metal prices are higher All of our costs went up at the producer level, the service center level at our customer level. all of our costs went up at the producer level the service center level at our customer level So I think you know we think it's a step up in higher pricing model which we're generating higher earnings dollars, higher cash flow, our investments in value add processing kind of mitigating some of that metal price risk. But I can't point to one thing or really parse out, but metal prices would probably be the biggest driver. So I think you know we think it's a step up in higher pricing model which we're generating higher earnings dollars, higher cash flow, our investments in value add processing kind of mitigating some of that metal price risk. so i think you know we think it's a step up in higher pricing model which we're generating higher earnings dollars higher cash flow our investments in value add processing kind of mitigating some of that metal price risk But I can't point to one thing or really parse out, but metal prices would probably be the biggest driver. but i can't point to one thing or really parse out but metal prices would probably be the biggest driver

Speaker 1: I think we're out of time. I wanted to thank Carl and Steven for a very nice presentation and I'm sure you could follow-up myself or Carl and Steven after. Thank you. I think we're out of time. i think we're out of time I wanted to thank Carl and Steven for a very nice presentation and I'm sure you could follow-up myself or Carl and Steven after. i wanted to thank carl and steven for a very nice presentation and i'm sure you could follow-up myself or carl and steven after Thank you. thank you

Speaker 2: Thank you. Thank you. thank you

Speaker 3: Thank you. Thank you. thank you