NYSE$RS

Reliance Steel And Aluminum Co · Q3 2020 earnings

Q3 2020 earnings · · Investor relations

Briefing

Reported a record gross profit margin and increased earnings due to diverse product mix and end market exposures.

Reliance Steel & Aluminum Co. reported strong Q3 2020 financial results, driven by its resilient business model, diverse product mix, and decentralized operating structure. The company achieved a record gross profit margin of 32.4% and non-GAAP earnings per diluted share of $1.87.

  • Record gross profit margin of 32.4%.
  • EPS of $1.51, non-GAAP EPS of $1.87.
  • Pretax income of $127.0 million, non-GAAP pretax income of $158.0 million.
  • Generated cash flow from operations of $296.3 million.

Headline financials

Total Revenue

$2.09B

Previous: $2.69B-22.4%
EPS (adj)

$1.87

Previous: $2.39-21.8%
Capital Expenditures

-$135M

Previous: -$183M+26.3%
Free Cash Flow

-$36.4M

Previous: -$18.9M-92.6%
Net Income

$98.3M

Previous: $164M-40.0%
Operating Income

$161M

Previous: $241M-33.5%
Gross Profit

-$1.41B

Previous: -$1.87B+24.7%
Cash & Equivalents

$592M

Previous: $166M+256.4%
Total Assets

$8B

Previous: $8.13B-1.6%
Stock-Based Comp

$11.9M

Previous: $15.2M-21.7%

Revenue & EPS history

Reliance Steel · Revenue · Quarterly

$2.09B

Q3 2020-22.4%vs Q3 2019
Beat estimate in 12 of 16 quarters(75%)
ActualEstimate

Forward guidance

Reliance management anticipates overall demand to continue its slow improvement in the fourth quarter of 2020. The Company estimates that tons sold will be down 4% to 6% and non-GAAP earnings per diluted share in the range of $1.30 to $1.40 for the fourth quarter of 2020.

Tailwinds

  • Overall demand to continue its slow improvement in the fourth quarter of 2020.
  • The impact of seasonal factors could be less than in prior years.
  • Metals pricing, primarily for carbon steel products, in the fourth quarter will improve due to mill price increases.

Headwinds

  • Macroeconomic uncertainty stemming from the COVID-19 pandemic continues.
  • Due to normal seasonal factors including customer holiday-related shutdowns.
  • Fewer shipping days in the fourth quarter of 2020 compared to the third quarter of 2020, the Company expects shipping volumes to decline.
  • Price increases will be partially offset given Reliance’s diverse product mix and declining sales in certain markets such as aerospace which typically involve higher priced products.

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 Q3 2020

Historical avgQ3 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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