NYSE$RS

Reliance Steel And Aluminum Co · Q2 2020 earnings

Q2 2020 earnings · · Investor relations

Briefing

Reported solid results during a challenging quarter with strong gross profit margin and cash flow generation.

Reliance Steel & Aluminum Co. reported a strong gross profit margin of 30.4% on net sales of $2.02 billion for Q2 2020. The company generated $475.7 million in cash flow from operations and EPS of $1.24, non-GAAP EPS of $1.36.

  • Maintained a strong gross profit margin of 30.4% on net sales of $2.02 billion.
  • Generated cash flow from operations of $475.7 million.
  • Earnings per diluted share (EPS) reached $1.24, with non-GAAP EPS at $1.36.
  • Declared a quarterly dividend of $0.625 per share.

Headline financials

Total Revenue

$2.02B

Previous: $2.88B-30.0%
EPS (adj)

$1.36

Previous: $2.71-49.8%
Capital Expenditures

-$96.5M

Previous: -$124M+22.1%
Free Cash Flow

-$15.8M

Previous: $60.4M-126.2%
Net Income

$80.7M

Previous: $184M-56.2%
Operating Income

$119M

Previous: $267M-55.5%
Gross Profit

-$1.4B

Previous: -$2.03B+30.8%
Cash & Equivalents

$223M

Previous: $142M+57.4%
Total Assets

$7.72B

Previous: $8.33B-7.2%
Stock-Based Comp

$9.1M

Previous: $13.9M-34.5%

Revenue & EPS history

Reliance Steel · Revenue · Quarterly

$2.02B

Q2 2020-30%vs Q2 2019
Beat estimate in 13 of 16 quarters(81%)
ActualEstimate

Forward guidance

Reliance anticipates overall demand in the third quarter of 2020 to improve slightly compared to the second quarter of 2020. Reliance management expects overall demand in the third quarter of 2020 to improve slightly compared to the second quarter of 2020.

Tailwinds

  • Cautiously optimistic demand outlook in non-residential construction end market.
  • Tolling volumes are expected to increase meaningfully from second quarter levels to support current automotive production rates.
  • Overall metals pricing in the third quarter will remain generally consistent with current levels.
  • Gross profit margin will remain near the high end of its estimated sustainable range of 28% to 30%.
  • Decentralized model provided flexibility to ramp up individual operations quickly as demand trends improved.

Headwinds

  • Continued declines in demand for aerospace and energy (oil and gas)-related end markets.
  • Further offset in shipping volume due to normal seasonal customer shutdowns and vacation schedules typical in the third quarter.
  • Continued macroeconomic uncertainty stemming from the COVID-19 pandemic.
  • Magnitude and duration of the COVID-19 pandemic, including its impact on the Company’s operations, supply chain and customers remains fluid.
  • Commercial aerospace demand declined considerably as a direct result of reduced air travel due to COVID-19.

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 20 quarterly earnings reports · overlaid with Q2 2020

Historical avgQ2 2020

+1.3%

Avg return

Earnings day

+1.9%

Avg return

5 days after

+1.6%

Avg return

30 days after

64%

44 / 69 earnings

Positive

+17.0%

Q3 2019

Best reaction

-13.2%

Q2 2011

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2026-1.9%+3.3%+4.5%
Q4 2025-2.7%-5.7%-13.6%
Q3 2025-0.3%+2.1%+0.3%
Q2 2025-1.5%-1.4%+0.2%
Q1 2025+0.7%+1.7%+3.1%
Q4 2024+3.1%+0.8%-5.5%
Q3 2024+0.3%+4.1%+13.0%
Q2 2024+3.5%+2.8%-4.0%
Q1 2024-7.3%-9.2%-3.1%
Q4 2023+10.8%+7.8%+8.8%
Q3 2023+0.5%+2.9%+8.4%
Q2 2023-0.3%+0.9%-5.1%
Q1 2023+3.1%+3.1%-0.3%
Q4 2022+6.2%+3.6%+3.0%
Q3 2022+2.8%+5.6%+9.1%
Q2 2022+1.9%-0.1%+4.2%
Q1 2022+4.8%+8.1%+8.3%
Q4 2021+4.0%+3.8%+13.9%
Q3 2021+1.5%+4.5%+9.9%
Q2 2021+0.3%+1.6%-0.6%
Q1 2021+1.5%+3.2%+7.0%
Q4 2020+4.7%+8.1%+18.6%
Q3 2020-0.7%-2.8%+5.5%
Q2 2020+6.2%+3.9%+7.2%
Q1 2020+3.9%+6.7%+9.1%
Q4 2019-5.3%-8.3%-36.5%
Q3 2019+17.0%+20.7%+17.3%
Q2 2019+10.6%+8.2%+2.7%
Q1 2019+3.3%+3.5%-4.3%
Q4 2018+3.1%+4.2%+0.7%
Q3 2018-0.3%+0.6%+3.9%
Q2 2018-1.3%-1.9%-4.4%
Q1 2018+0.3%-1.6%+4.6%
Q4 2017+6.8%+4.7%+2.4%
Q3 2017+2.8%+1.0%-0.4%
Q2 2017-2.9%-2.7%-4.1%
Q1 2017-1.0%-2.6%-8.5%
Q4 2016+1.0%+2.2%-3.9%
Q3 2016-5.8%-5.5%+5.7%
Q2 2016-7.2%-6.1%-11.3%
Q1 2016-1.5%
Q4 2015-1.7%
Q3 2015+8.9%
Q2 2015+4.5%
Q1 2015+9.9%
Q4 2014+6.5%
Q3 2014+2.1%
Q2 2014-5.3%
Q1 2014-2.8%
Q4 2013-3.1%
Q3 2013-2.5%
Q2 2013+1.5%
Q1 2013-4.5%
Q4 2012+0.1%
Q3 2012+5.4%
Q2 2012+10.4%
Q1 2012-0.6%
Q4 2011-0.7%
Q3 2011+1.1%
Q2 2011-13.2%
Q1 2010+3.0%
Q1 2011-0.1%
Q4 2010+1.4%
Q4 2008+1.4%
Q3 2010+1.2%
Q3 2009+1.2%
Q2 2010+1.0%
Q4 2009+1.0%
Q2 2009+1.0%

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