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Mar 31, 2023
Reliance Steel Q1 2023 Earnings Report
Reported strong Q1 2023 financial results with solid demand and increased shipments.
Key Takeaways
Reliance Steel & Aluminum Co. reported strong first quarter results with net sales of $3.97 billion. Shipments were up 17.7% from the prior quarter, and the company achieved a gross profit margin of 30.9%. EPS was $6.43, and non-GAAP EPS was $6.37. The company generated $384.6 million in operating cash flow and repurchased $38.9 million of common stock.
Net sales reached $3.97 billion, driven by solid demand across most end markets.
Tons sold increased by 17.7% compared to the previous quarter, surpassing expectations.
Gross profit margin remained strong at 30.9%, contributing to pretax income of $508.5 million.
Generated $384.6 million in operating cash flow, supporting investments in growth and returns to stockholders.
Reliance Steel
Reliance Steel
Forward Guidance
Reliance expects underlying demand to remain healthy in the second quarter of 2023, with tons sold to be flat to down 2% compared to the first quarter of 2023. The company anticipates non-GAAP earnings per diluted share in the range of $6.40 to $6.60 for the second quarter of 2023.
Positive Outlook
- Healthy underlying demand expected to continue.
- Anticipates overall pricing to remain fairly stable with slight upside from recently announced carbon steel price increases.
- Expects slight upside from recently announced carbon steel price increases.
- Company estimates its average selling price per ton sold in the second quarter of 2023 will be flat to up 2% compared to the first quarter of 2023.
- Demand in non-residential construction (including infrastructure) improved from the first quarter of 2022.
Challenges Ahead
- Tons sold expected to be flat to down 2% in the second quarter of 2023 compared to the first quarter of 2023
- One less shipping day in the second quarter of 2023
- Absence of the demand pull-forward experienced in the first quarter of 2023.
- Semiconductor market trended down slightly from the fourth quarter of 2022.
- Uncertainty in the business environment