Q4 2024 Steel Dynamics Inc Earnings Call

January 23, 2025

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Speaker Change: At this time I would like to turn the conference over to David Lipschitz Director Investor Relations. Please go ahead.

Thank you Matthew good morning, and welcome to steel dynamics fourth quarter and full year 2004 earnings Conference call. As a reminder, today's call is being recorded and will be available on our website for replay later today.

Leading today's call are Mark Millett, Chairman and Chief Executive Officer of Steel dynamics, Theresa Wagler, Executive Vice President and Chief Financial Officer, and Barry Schneider, President and Chief operating officer. The other members of our senior leadership team are joining us on the call individually.

Speaker Change: Some of today's statements, which speak only as of this date may be forward looking and predictive typically preceded by believe expect anticipate or words of similar meaning.

Speaker Change: They are intended to be protected by the private Securities Litigation Litigation Reform Act of 1995 should actual results turn out differently.

Speaker Change: Such statements involve risks and uncertainties related to integrating our starting up new assets the aluminum industry. The use of estimates and assumptions in connection with anticipated project returns and our steel metals recycling and fabrication businesses as well as to general business and economic conditions example of these are described in the related press release as well as in our annually filed SEC form <unk>.

10-K under the headings forward looking statements and risk factors found on the Internet at Www Dot FCC Dot Gov, and if applicable in any later SEC Form 10-Q, you will also find any referenced non-GAAP financial measures are reconciled to the mostly directly comparable GAAP measures in the press release issued yesterday entitled Steel dynamics reports fourth quarter and full.

Mark: Year 2024 results and now I'm pleased to turn the call over to Mark.

Mark: Thank you David.

Mark: Everyone. We appreciate you taking the time to join us for our fourth quarter and full year 2024 earnings call.

Mark: As you saw our teams achieved a solid financial and operational performance in 2024, and what was a challenging market environment.

Mark: <unk> best in class financial metrics.

Mark: <unk> is certainly a testament to our business model and performance driven culture.

Mark: The highlights obviously, its second highest annual steel shipments of $12 7 million tons cash.

Mark: Cash from operations of $1 8 billion and adjusted EBITDA of $2 5 billion.

Mark: And most importantly, we celebrated our safest year ever.

Mark: Additionally, we have been ramping up for new value added flat roll steel coating lines with the expectation of full earnings benefit in 2025. These.

Mark: These lines represent an additional $1 1 million tons of higher margin product diversification for us.

Mark: The <unk> team gained considerable momentum in the last two months running above 80% capacity.

Mark: Doing even better in January.

Mark: With expectations to reach profitability in the coming months and Barry will go into more detail in his comments about the progress and what is yet to come.

Please hold and operator will be with you momentarily.

Mark: Aluminum dynamics <unk> first aluminum ingot two weeks ago at our Columbus facility.

Uh huh.

Mark: Extremely proud and excited for the team.

Speaker Change: Hello Conference in Anaheim police have access code.

Mark: Everything is on schedule for a systematic commissioning of the rest of the plant to ensure commercial shipments. This June.

Speaker Change: I could not be more prior to the entire steel dynamics team.

Speaker Change: The foundation of our company there is no doubt that the passion innovative spirit and commitment drives our success.

Speaker Change: Yes, I have them here.

Speaker Change: Alright could you spell your first and last one for me.

Speaker Change: As I mentioned.

The most gratifying achievement was having a record year in terms of safety.

Speaker Change: Both our recordable injury and last time rates were the lowest in our history.

Speaker Change: We continue to build a world class safety culture, and our team's dedication to our take control of safety program is absolutely extraordinary.

David: Okay and your company has shrunk.

Speaker Change: The core safety teams visit at 85% of 124 locations in 2024.

David: I'll go to Johnson.

David: Mhm.

Speaker Change: These teams are made up of our teammates who volunteered sacrifice time from their families keep their colleagues safe.

David: And they are doing even better in January.

David: With expectations to reach profitability in the coming months and Barry will go into more detail in his comments about the progress and what is yet to come.

Speaker Change: You are truly making it happen.

Speaker Change: 60% of our locations at zero recordable injuries, and 81% had zero lost time incidents last year.

David: Aluminum dynamics cast as first aluminum ingot two weeks ago at our Columbus facility.

Speaker Change: I am continually inspired by the commitment of our team members have for one another.

Speaker Change: Alright extremely proud and excited for the team.

Speaker Change: Consider themselves family and challenge the status quo, each and every day.

Everything is on schedule for a systematic commissioning of the rest of the plant to ensure commercial shipments. This June.

Speaker Change: And even with those phenomenal phenomenal performance metrics, we certainly have a lot of work to do as we strive toward our zero incident environment goal.

David: I could not be more prior to the entire steel dynamics team now.

David: They are the foundation of our company Theres no doubt that their passion innovative spirit and commitment drives our success.

So with that introduction Teresa would you like to give us your thoughts for the third quarter on for the year.

As I mentioned.

Teresa: Thanks, Mike Good morning, everyone. Thank you for joining us as Mark mentioned 2024 had its challenges the team performed well and I want to recognize that in 2024, we achieved operating income of $1 9 billion and net income of $1 $5 billion or $9 84 per diluted share cash.

David: Suddenly the most gratifying achievement was having a record year in terms of safety.

David: Both our recordable injury and last time rates were the lowest in our history.

David: We continue to build a world class safety culture, and our team's dedication to our take control of safety program is absolutely extraordinary.

David: Core safety teams visited 85% of 124 locations in 2024.

Teresa: Flow from operations was $1 8 billion in liquidity remained strong at $2 $2 billion as we continued meaningful organic growth investments and strong shareholder returns and not to be ignored or three year. After tax return on invested capital was resilient at 23%.

David: These teams are made up of our teammates who volunteered sacrifice time from their families to keep their colleagues safe.

David: And they are truly making it happen.

David: 60% of our locations at zero recordable injuries, and 81% had zero lost time incidents last year.

Teresa: As for the fourth quarter of 2024, our net income was $207 million or $1 36 per diluted share with adjusted EBITDA of $372 million as some of you noted our effective tax rate benefited the quarter, approximately $13 million or five 4% due to state adjustments.

David: I am continually inspired by the commitment of our team members have for one another.

David: They consider themselves family and challenge the status quo, each and everyday.

David: And they even with those phenomenal phenomenal performance metrics, we certainly have a lot of work to do as we strive toward our cero incident environment goal.

Teresa: And another 3% benefit related to certain reserved items.

Okay and challenge the status quo, each and every day.

David: So with that introduction Teresa would you like to give us your thoughts for the cause corridor for the year.

And even with those phenomenal phenomenal performance metrics, we certainly have a lot of work to do as we strive toward our CLO incident environment goal.

Teresa: Fourth quarter 2024 revenues were $3 9 billion and operating income was $238 million lower than sequential third quarter results driven by lower realized steel pricing and seasonal volume.

Teresa: Thanks, Mike Good morning, everyone. Thank you for joining us as Mark mentioned 'twenty 'twenty four had its challenges yeah. The team performed well and I want to recognize that.

Speaker Change: So with that introduction Teresa would you like to give us your thoughts for the quarter and for the year.

Teresa: Our steel operations generated operating income of $165 million in the quarter sequentially lower as average pricing declined $48 per tonne, while scrap pricing remained relatively flat.

Teresa: 'twenty 'twenty four we achieved operating income of $1 9 billion and net income of $1.5 billion or $9.84 per diluted share.

Speaker Change: Thanks, Mark Good morning, everyone. Thank you for joining us as Mark mentioned 2024 had its challenges.

Speaker Change: The team performed well and I want to recognize that in 2024, we achieved operating income of $1 9 billion and net income of $1 $5 billion or $9 84 per diluted share cash.

David: Cash flow from operations was $1 8 billion in liquidity remained strong at $2.2 million as we continued meaningful organic growth investments and strong shareholder returns and not to be ignored or three year. After tax return on invested capital was resilient at 23%.

Seasonally lower shipments declined 5% in the quarter across the steel platform with a 50000 ton negative impact at our Butler flat roll division related to an unplanned outage.

Speaker Change: Cash flow from operations was $1 8 billion in liquidity remains strong at $2 $2 billion as we continued meaningful organic growth investments and strong shareholder returns and not to be ignored or three year. After tax return on invested capital was resilient at 23%.

For the full year 2020 for operating income from our steel operations was $1 $6 billion with near record annual shipments.

David: As for the fourth quarter of 2024, our net income was $207 million or dollar 36 per diluted share with adjusted EBITDA of $372 million as some of you noted our effective tax rate benefited the quarter, approximately $13 million or five 4% due to state adjustments and <unk>.

Teresa: For your modeling purposes for the quarter, our hot band shipments were 901000 tons, our cold rolled shipments were 119000 tons and our coated flat rolled shipments were $1 million 282000 tons.

Speaker Change: As for the fourth quarter of 2024, our net income was $207 million or $1 36 per diluted share with adjusted EBITDA of $372 million.

David: Another 3% benefit related to certain reserve items.

Teresa: Likely many of you noticed a reclassification in our supplemental data in the fourth quarter, we reclassified the financial impact of certain aluminum operations from our metals recycling segment to our new aluminum segment impacting the associated revenue and operating income lines in our historical data.

David: Some of you noted our effective tax rate benefited the quarter, approximately $13 million or five 4% due to state adjustments and another 3% benefit related to certain reserve items.

Fourth quarter 2024 revenues were $3 $9 billion in operating income was $238 million lower than sequential third quarter results driven by lower realized steel pricing and seasonal volume.

David: Fourth quarter 2024 revenues were $3 $9 billion in operating income was $238 million lower than sequential third quarter results driven by lower realized steel pricing and seasonal volume.

David: Our steel operations generated operating income of $165 million in the quarter sequentially lower as average pricing declined $48 per tonne, while scrap pricing remained relatively flat.

Teresa: For context for 2024. This would have shifted income of approximately $15 million from our metals recycling unit down to aluminum operations.

Our steel operations generated operating income of $165 million in the quarter sequentially lower as average pricing declined $48 per tonne, while scrap pricing remained relatively flat.

David: Seasonally lower shipments declined 5% in the quarter across the steel platform with a 50000 ton negative impact at our Butler flat roll division related to an unplanned outage.

For the fourth quarter operating income from our metals recycling operations was $23 million as nonferrous metal spreads improved more than offsetting lower seasonal shipment for the <unk>.

David: For the full year 2024 operating income from Mircea operations was $1.6 billion with near record annual shipments.

Teresa: Full year of 2020 for operating income from our metals recycling operations was $77 million higher than prior year volume higher than prior year results as volume and metal spread improved across the platform.

David: Lower shipments declined 5% in the quarter across the steel platform with a 50000 ton negative impact at our Butler flat roll division related to an unplanned outage.

David: For your modeling purposes for the quarter, our hot band shipments were 901000 tons, our cold rolled shipments were 119000 tons at our coated flat rolled shipments were 1.282 million tons.

David: For the full year 2020 for operating income from our steel operations was $1 $6 billion with near record annual shipments.

Teresa: We're the largest north American metals, recycler processing and consuming ferrous scrap in nonferrous aluminum copper and other materials.

David: For your modeling purposes for the quarter, our hot band shipments were 901000 tons, our cold rolled shipments were 119000 tons and our coated flat rolled shipments were $1 million 282000 tons.

Teresa: And we are growing in support of our increased steel capacity and soon to be aluminum flat rolled operations through new and expanded supplier relationships and through the use of innovative new separation technologies I'm really proud of what the mills recycling team's doing.

David: Likely many of you noticed a reclassification in our supplemental data in the fourth quarter, we reclassified the financial impact of certain aluminum operations from our metals recycling segment to our new aluminum segment impacting the associated revenue and operating income lines in our historical data.

Teresa: As it relates to steel fabrication, our steel fabrication team achieved fourth quarter operating income of $142 million lower than sequential third quarter results as realized pricing declined a modest 4% and shipments seasonally decrease for the full year 2024 earnings from the platform were 660.

David: Contacts for 2024. This would have shifted income of approximately $15 million from our metals recycling unit down to aluminum operations.

Teresa: $7 million.

Teresa: Contacts for 2024. This would have shifted income of approximately $15 million from our metals recycling unit down to aluminum operations.

David: For the fourth quarter operating income from our metals recycling operations was $23 million as nonferrous metal spreads improved more than offsetting lower seasonal shipment for the full year of 2020 for operating income from our metals recycling operations was $77 million higher than prior year volume are higher than prior year results.

Teresa: Representing a very good year, our steel joist and deck demand remains solid with good order activity and Barry will expand more on that in a minute.

Teresa: We believe that the infrastructure emulation reduction act manufacturing growth and onshoring will still increase.

Teresa: For the fourth quarter operating income from our metals recycling operations was $23 million as nonferrous metal spreads improved more than offsetting lower seasonal shipment.

Teresa: And support fixed asset investment and related flat and long products steel and steel joist and deck consumption in the coming year.

David: Volume and metal spread improved across the platform.

David: For the full year of 2020 for operating income from our metals recycling operations was $77 million higher than prior year volumes are higher than prior year results as volume and metal spread improved across the platform.

David: We're the largest north American metals, recycler processing and consuming ferrous scrap in nonferrous aluminum copper and other materials and.

Teresa: Turning to our aluminum operations, a quick reminder, as we finish constructing the aluminum facilities non capitalized expenses are required to flow through SG&A until startup.

David: And we are growing in support of our increased steel capacity and soon to be aluminum flat rolled operations through new and expanded supplier relationships and through the use of innovative new separation technologies I'm really proud of what the mills recycling team's doing.

David: We're the largest north American metals, recycler processing and consuming ferrous scrap in nonferrous aluminum copper and other materials.

Teresa: As a result, our SG&A was higher in 2024 by approximately $88 million.

Teresa: We continue to have expectations to be EBITDA positive in the second half of 2025 for this platform and plan to operate the rolling mill at approximately 50% in 2025 and 75% in 2026.

David: As it relates to steel fabrication, our steel fabrication team achieved fourth quarter operating income of $142 million lower than sequential third quarter results as realized pricing declined a modest 4% and shipments seasonally decrease for the full year 2024 earnings from the platform were 660.

Teresa: Construction and commissioning of the Rolling mill in the San Luis Potosi recycled slab center are progressing extremely well.

Teresa: Approximately $2 $2 billion has already been invested through December 2024, with expectations of funding the remaining 500 plus million dollars in 2025.

David: $7 million, representing a very good year.

David: Our steel joist and deck demand remained solid with good order activity and Barry will expound more on that in a minute.

Teresa: During the fourth quarter of 2024, we generated cash flow from operations of $347 million for the full year, we achieved annual cash flow of $1 8 billion.

David: We believe that the infrastructure emulation reduction act manufacturing grows and onshoring will still increase and support fixed asset investment and related flat and long products steel and steel joist and deck content consumption in the coming year.

David: $7 million.

Representing a very good year.

David: Our steel joist and deck demand remains solid with good order activity and Barry will expound more on that in a minute.

Teresa: Working capital in the fourth quarter grew with the improved performance at Sinton and preparation for startup at our aluminum facilities, which represented an increase generally of around $100 million. In addition to some unexpected increases we had in width and finished goods at some of our long product divisions, which we expect to be.

David: We believe that the infrastructure emulation reduction act manufacturing growth and onshoring will still increase.

David: Pivoting to our aluminum operations, a quick reminder, as we finish constructing the aluminum facilities non capitalized expenses are required to flow through SG&A until startup as a result, our SG&A was higher in 2024 by approximately $88 million.

David: And support fixed asset investment and related flat and long products steel and steel joist and deck consumption in the coming year.

David: Pivoting to our aluminum operations, a quick reminder, as we finish constructing the aluminum facilities.

Teresa: Our right sized shortly.

Teresa: Our cash generation is consistently strong based on a differentiated circular business model and highly variable low cost structure at the end of the year, we had liquidity of $2 $2 billion comprised of cash and investments.

David: We continue to have expectations to be EBITDA positive in the second half of 2025 for this platform and plan to operate the rolling mill at approximately 50% in 2025 and 75% in 2026.

David: Non capitalized expenses are required to flow through SG&A until startup.

David: As a result, our SG&A was higher in 2024 by approximately $88 million.

David: We continue to have expectations to be EBITDA positive in the second half of 2025 for this platform and plan to operate the rolling mill at approximately 50% in 2025 and 75% in 2026.

Teresa: <unk> $1 billion and a fully available unsecured revolver of $1 2 billion.

David: The construction and commissioning of the Rolling mill in the San Luis Potosi recycled slab center are progressing extremely well approximately $2.2 billion has already been invested through December 2024 with expectations of funding the remaining 500 plus million dollars in 2025.

Teresa: During 2024, we invested $1 $9 billion in capital investments of which approximately 70% related to construction of our aluminum flat rolled investments.

David: Construction and commissioning of the Rolling mill in the San Luis Potosi recycled slab center are progressing extremely well approximately $2 $2 billion has already been invested through December 2024 with expectations of funding the remaining 500 plus million dollars in 2025.

Teresa: Approximately $200 million of funding for the aluminum investments shifted from the fourth quarter to 2025 spending I'd just add as did some other smaller projects throughout the company, increasing our full year capital investments estimate from the original $750 million to $800 million.

David: During the fourth quarter of 'twenty 'twenty, four we generated cash flow from operations of $347 million for the full year, we achieved annual cash flow of $1 $8 billion.

David: During the fourth quarter of 2024, we generated cash flow from operations of $347 million for the full year, we achieved annual cash flow of $1 $8 billion.

To closer to $1 billion at this point again this is simply a timing shift.

Teresa: In the fourth quarter, we repurchased $295 million of our common stock and $1 $2 billion for the year, representing 6% of our outstanding shares.

David: Working capital in the fourth quarter grew with the improved performance at Sinton and preparation for startup at our aluminum facilities, which represented an increase generally of around $100 million. In addition to some unexpected increases we had in width and finished goods at some of our long product divisions, which we expect to be right.

David: In addition to some unexpected increases we had in width and finished goods at some of our long product divisions, which we expect to be right sized shortly.

David: Our cash generation is consistently strong based on a differentiated circular business model and highly variable low cost structure at the end of the year, we had liquidity of $2.2 billion comprised of cash and investments of approximately $1 billion and a fully available unsecured revolver of $1.2 billion.

Teresa: December 31, we had $194 million remaining authorized for repurchase.

Teresa: These actions reflect the strength of our capital Foundation and consistently strong cash flow generation capability, and then continued optimism and confidence in our future.

David: Shortly.

David: Our cash generation is consistently strong based on a differentiated circular business model and highly variable low cost structure at the end of the year, we had liquidity of $2 $2 billion comprised of cash and investments of approximately $1 billion and a fully available unsecured revolver of $1 $2 billion.

Teresa: Our capital allocation strategy prioritizes high return growth with shareholder distributions comprised of a base positive dividend profile that is complemented with a variable share repurchase program, while we remain dedicated to preserving our investment grade credit ratings.

David: During 2024, we invested $1 $9 billion in capital investments of which approximately 70% related to construction of our aluminum flat roll of investments.

David: Approximately $200 million of funding for the aluminum investments shifted from the fourth quarter to 2025 spending I just add as did some other smaller projects throughout the company, increasing our full year capital investments estimate from the original $750 million to $800 million.

David: During 2024, we invested $1 $9 billion in capital investments of which approximately 70% related to construction of our aluminum flat roll of investments.

Teresa: Track record has proven achieving a three year after tax return on invested capital of 23% as I mentioned during a period of transformational growth and strong shareholder returns our free cash flow profile has fundamentally changed over the last five years.

Approximately $200 million of funding for the aluminum investments shifted from the fourth quarter to 2025 spending I'd just add as did some other smaller projects throughout the company, increasing our full year capital investments estimate from the original $750 million to $800 million.

Teresa: Our annual average free cash flow used to be around $540 million today in the last five years is closer to $3 billion.

David: To closer to $1 billion at this point again this is simply a timing shift.

David: In the fourth quarter, we repurchased $295 million of our common stock at $1.2 billion for the year, representing 6% of our outstanding shares.

Teresa: We have placed ourselves in a position of strength to have sustainable capital Foundation that provides the opportunity for meaningful strategic growth and strong shareholder returns, while maintaining investment grade metrics, we're squarely positioned for the continuation of sustainable optimized long term value creation.

David: Closer to $1 billion at this point again this is simply a timing shift.

David: At December 31st we had $194 million remaining authorized for repurchase.

David: In the fourth quarter, we repurchased $295 million of our common stock and $1 $2 billion for the year, representing 6% of our outstanding shares.

David: These actions reflect the strength of our capital Foundation and consistently strong cash flow generation capability, and the continued optimism and confidence in our future.

On the sustainability front as we mentioned on the third quarter call. In 2024, we did announce new certified science base greenhouse gas emissions intensity targets for our steel mills.

David: December 31, we had $194 million remaining authorized for repurchase.

David: Our capital allocation strategy prioritizes high return growth with shareholder distributions comprised of a base positive dividend profile that is complemented with a variable share repurchase program, while we remain dedicated to preserving our investment grade credit ratings.

David: These actions reflect the strength of our capital Foundation and consistently strong cash flow generation capability, and the continued optimism and confidence in our future.

Teresa: They are in alignment with the one five degree set forth in the Paris agreement, we have interim 2030 emissions intensity goals as well as 2050 goals and we feel very strongly that we can accomplish this.

David: Track record has proven achieving a three year after tax return on invested capital of 23% as I mentioned during a period of transformational growth and strong shareholder returns our free cash flow price profile has fundamentally changed over the last five years, our annual average free cash flow used to be around 540.

Teresa: The carbonization is a meaningful part of our long term value creation strategy and we're dedicated to our people our communities and our environment.

Teresa: We uniquely have an actionable path forward, that's more manageable and we believe considerably less expensive than May lay ahead for many of our industry peers.

David: Track record has proven achieving a three year after tax return on invested capital of 23% as I mentioned during a period of transformational growth and strong shareholder returns our free cash flow profile has fundamentally changed over the last five years, our annual average free cash flow used to be around 500.

David: <unk> million dollars today in the last five years is closer to $3 billion.

Teresa: Our carbon reduction strategy is an ongoing journey and we're moving forward with the intention to make a positive difference.

David: We've placed ourselves in a position of strength to have sustainable capital Foundation that provides the opportunity for meaningful strategic growth and strong shareholder returns, while maintaining investment grade metrics, we're squarely positioned for the continuation of sustainable optimized long term value creation.

Teresa: And uniquely actually Tricia just let me know last night, we received an award from the corporate that right Tricia the corporate Knights.

David: And $40 million today in the last five years is closer to $3 billion.

Speaker Change: And we're one of the world's most sustainable companies in fact were 29th out of 100 companies and we are the only steel company that was mentioned so I think that's pretty good and I want to give my congratulations to the teams because we can't do it without them.

David: On the sustainability front as we mentioned on the third quarter call. In 2024, we did announce new certified science based greenhouse gas emissions intensity targets for our steel mills.

Teresa: Barry.

Thank you Theresa.

David: They are in alignment with the one and a half degree set forth in the Paris agreement, we have interim 2030 emissions intensity goes as well as 2050 goals and we feel very strongly that we can accomplish this <unk>.

David: On the sustainability front as we mentioned on the third quarter call. In 2024, we did announce new certified science base greenhouse gas emissions intensity targets for our steel mills.

David: They are in alignment with the one five degree set forth in the Paris agreement, we have interim 2030 emissions intensity goes as well as 2050 goals and we feel very strongly that we can accomplish this.

Speaker Change: We need to have high expectations for the business due to the positive customer sentiment high quoting activity moderating interest rate environment continued manufacturing onshoring and public funding for infrastructure and other fixed asset investment programs.

David: The carbonization is a meaningful part of our long term value creation strategy and we're dedicated to our people our communities and our environment.

David: We uniquely have an actionable path forward, that's more manageable and we believe considerably less expensive than May lay ahead for many of our industry peers.

David: Carbonization is a meaningful part of our long term value creation strategy and we are dedicated to our people our communities and our environment.

The uplift from this macro environment could be considerable for this platform as well as for our steel operations. Our steel fabrication platform provides meaningful volume support for our steel mills critical and softer demand environment, allowing for higher through cycle steel utilization compared to our peers. It also helps mitigate the financial risk of lower steel prices.

David: Our carbon reduction strategy is an ongoing journey and we're moving forward with the intention to make a positive difference.

David: We uniquely have an actionable path forward, that's more manageable and we believe considerably less expensive than May lay ahead for many of our industry peers.

David: And uniquely actually Tricia just let me know last night, we received an award from the corporate.

David: Our carbon reduction strategy is an ongoing journey and we're moving forward with the intention to make a positive difference.

Speaker Change: Right Tricia the corporate Knights.

Our metals recycling operations also performed very well this year, considering the challenge of declining scrap prices through most of 2024.

Speaker Change: And we're one of the world's most sustainable companies in fact were 29th out of 100 companies and we're the only steel company that was mentioned so I think that's pretty good and I want to give a congratulations to the teams because we can't do it without them.

David: And uniquely actually Tricia just let me know last night, we received an award from the corporate that right Tricia the corporate Knights.

Speaker Change: The North American geographic footprint of our metals recycling platform provides a strategic competitive advantage for our steel mills and for our scrap generating customers in particular, our Mexican locations competitively advantage, our Columbus and sit in the raw material positions. They also strategically support aluminum scrap procurement for our flat rolled aluminum.

David: And we're one of the world's most sustainable companies in fact were 29th out of 100 companies and we're the only steel company that was mentioned, but I think that's pretty good and I want to give a congratulations to the teams because we can't do it without them.

Speaker Change: So with that Barry.

Speaker Change: Thank you Theresa.

Speaker Change: Our steel fabrication operations performed well throughout 2024, achieving historically strong earnings at the end of the year, our steel joist and deck order backlog was solid extending through the first half of 2025, we continue to have high expectations for the business due to the positive customer says sentiment high quoting activity.

Barry: So with that Barry.

Speaker Change: Investments.

Barry: Thank you Theresa.

Speaker Change: Our metals recycling team is also partnering even more closely with both our steel and aluminum teams to expand scrap separation capabilities through both process and technology solutions. This will help mitigate potential prime ferrous scrap supply issues in the future we.

Barry: Our steel fabrication operations performed well throughout 2024, achieving historically strong earnings at the end of the year, our steel joist and deck order backlog was solid extending through the first half of 2025, we continue to have high expectations for the business does it positive customer sentiment high quoting activity.

Speaker Change: Moderating interest rate environment continued manufacturing onshoring and public funding for infrastructure and other fixed asset investment programs.

Speaker Change: It will also provide us with a significant advantage to materially increase the recycled content for our aluminum flat rolled products and increase our earnings opportunities.

Speaker Change: The uplift from this macro environment could be considerable for this platform as well as for our steel operations.

David: Moderating interest rate environment continued manufacturing onshoring and public funding for infrastructure and other fixed asset investment programs.

Speaker Change: Our steel fabrication platform provides meaningful volume support for our steel mills critical and softer demand environment, allowing for higher through cycle steel utilization compared to our peers. It also helps mitigate the financial risk of lower steel prices.

Speaker Change: Ferrous scrap prices have stabilized and have increased in January we expect prices to be moderately higher in February as well based on the extreme cold weather through much of the United States and resulting diminished scrap flows.

David: Uplift from this macro environment could be considerable for this platform as well as for our steel operations. Our steel fabrication platform provides meaningful volume support for our steel mills critical and softer demand environment, allowing for higher through cycle steel utilization compared to our peers, but also helps mitigate the financial risk of lower steel prices.

Speaker Change: Our metals recycling operations also performed very well this year, considering the challenge of declining scrap prices through most of 2020 for.

Speaker Change: The steel team had another strong year during 2020 for the domestic steel industry operated at an estimated production utilization rate of 77%, while our steel mills operated at a rate of 86% excluding sinton.

Speaker Change: The North American geographic footprint of our metals recycling platform provides a strategic competitive advantage for our steel mills and for our scrap generating customers in particular, our Mexican locations competitively advantage, our Columbus and sit in our raw material positions. They also strategically support aluminum scrap procurement for our flat rolled aluminum.

David: Our metals recycling operations also performed very well this year, considering the challenge of declining scrap prices through most of 2024.

Speaker Change: We consistently operated at higher utilization to our value added steel product diversification, our differentiated customer supply chain solutions and their support for our internal manufacturing businesses.

David: North American geographic footprint of our metals recycling platform provides a strategic competitive advantage for our steel mills and for our scrap generating customers in particular, our Mexican locations competitively advantage, our Columbus and sit in the raw material positions. We also strategically support aluminum scrap procurement for our flat rolled aluminum.

Speaker Change: This higher through cycle utilization of our steel mills is a key competitive advantage supporting our strong and growing cash generation capability and the best in class financial metrics.

Speaker Change: <unk> investments.

Speaker Change: Guarding the flat rolled steel markets pricing stabilized in the fourth quarter and into January flat rolled customer order entry has been seasonally strong to begin 2025 lead times remained steady and customers remain optimistic on the outlook.

David: Questions.

David: Our metals recycling team is also partnering even more closely with both our steel and aluminum teams to expand scrap separation capabilities through both process and technology solutions. This will help mitigate potential prime ferrous scrap supply issues in the future we.

Inventories remain historically lean, but increased imports of incremental buying at bay in certain product areas, specifically for coated flat rolled steel products as most of you know we love. We did trade case late in 2024, and we expect to get favorable countervailing and dumping rulings sometime in the next few months, which should significantly.

Speaker Change: Content for our aluminum flat rolled products and increase our earnings opportunities.

Speaker Change: Where scrap prices have stabilized and have increased in January we expect prices to be moderately higher in February as well based on the extreme cold weather through much of the United States.

David: We will also provide us with a significant advantage to materially increase the recycled content for our aluminum flat rolled products and increase our earnings opportunities.

Speaker Change: The resulting diminished scrap flows.

Ferrous scrap prices have stabilized and have increased in January we expect prices to be moderately higher in February as well based on the extreme cold weather through much of the United States and resulting diminished scrap flows.

Speaker Change: Inefficiently decrease these unfairly priced imports.

Speaker Change: Long product steel markets were challenged in the fourth quarter with seasonal weakness across the platform based on customer feedback the severe weather definitely had an impact as well as cautiousness related to the election outcome and possible administrative booths.

David: The steel team had another strong year during 2020 for the domestic steel industry operated at an estimated production utilization rate of 77%, while our steel mills operated at a rate of 86% excluding Sim.

Speaker Change: We consistently operate at higher utilization to our value added steel product diversification, our differentiated customer supply chain solutions and their support for our internal manufacturing businesses.

Speaker Change: We are already seeing order activity improvement and expect 2025% to pick up nicely in consumption as we progress through the first half of the year.

Speaker Change: Consistently operate at higher utilization to our value added steel product diversification, our differentiated customer supply chain solutions and the support for our internal manufacturing businesses.

Speaker Change: Based on our railroad rail customers discussions and project activity. We believe we will see increased demand for rail products in 2025, which will further help our product diversification and our long products group.

Speaker Change: Guarding the flat rolled steel markets pricing stabilize in fourth quarter and into January flat rolled customer order entry has been seasonally strong to begin 2025 lead times remain steady and customers remain optimistic on the outlook.

Barry: Higher through cycle utilization of our steel mills is a key competitive advantage supporting our strong and growing cash generation capability.

Speaker Change: Our sin in fact, our sinton, Texas flat roll steel most production reliability improved dramatically beginning in November exiting the year with a utilization rate over 80%. The team continues to improve with operation levels approaching 90% levels in the last four weeks we could.

Speaker Change: And the best in class financial metrics.

Speaker Change: Regarding the collateral steel markets pricing stabilized in the fourth quarter and into January collateral customer order entry has been seasonally strong to begin 2025 lead times remained steady and customers remain optimistic on the outlook.

Speaker Change: Inventories remain historically lean, but increased imports if cap incremental buying ebay in certain product areas, specifically for coated flat rolled steel products as most of you know we love. We did trade case late in 2024 and expect to get favorable countervailing and dumping rulings sometime in the next few months, which should significantly.

Speaker Change: Team continues working through quality and yield issues theyre keeping costs at elevated levels.

Speaker Change: Inventories remain historically lean, but increased imports of incremental buying ebay in certain product areas, specifically for coated flat rolled steel products as most of you know we love. We did trade case late in 2024, and we expect to get favorable countervailing and dumping rulings sometime in the next few months, which should significantly.

However, we expect these costs to moderate as we progress through the first half of the year, reaching positive earnings soon we continue to work on product development with <unk> capabilities to expand our flat rolled product offering.

Speaker Change: Inefficiently decrease these unfairly priced imports.

Speaker Change: Also the additional two new value added coating lines are up and running improving sentence operating efficiencies value added product mix and through cycle capabilities.

Speaker Change: Difficultly decrease these unfairly priced imports.

Speaker Change: Regarding the steel market environment, North American automotive production estimates for 2025 were recently revised slightly lower however, they remain at historically normal levels automotive dealer inventories continue to remain below historical norms and actually have declined further in December the <unk>.

We have already seen order activity improvement and expect 2025 to pick up nicely in consumption as we progress through the first half of the year.

Speaker Change: We have already seen order activity improvement and expect 2025% to pick up nicely in consumption as we progress through the first half of the year.

Speaker Change: To a fleet in the United States continues to age and has now reached a record high.

Speaker Change: Our specific automotive customer base has remained strong and our participation with the space has remained steady.

Speaker Change: Our sin in fact, our sinton, Texas flat roll steel most production reliability improve dramatically beginning in November exiting the year with a utilization rate over 80%.

Speaker Change: In some cases growing this is for both flat rolled products and our automotive SPG customers.

Speaker Change: <unk> continues to improve.

Speaker Change: Nonresidential construction remains stable with slowdowns across some industries. However, we believe moderating interest rates will unlock pent up project work and create new opportunities as we progress into 2025.

Speaker Change: Our sin in fact, our sinton, Texas flat roll steel most production reliability improve dramatically beginning in November exiting the year with a utilization rate over 80%.

Speaker Change: With operation levels approaching 90% levels in the last four weeks. The Katine continues working through quality and yield issues, they're keeping costs at elevated levels.

Speaker Change: Team continues to improve with operation levels approaching 90% levels in the last four weeks we.

We expect these costs to moderate as we progress through the first half of the year, reaching positive earnings soon we continue to work on product development with sentence capabilities to expand our flat rolled product offering.

Speaker Change: Additionally, onshoring in infrastructure spending should provide further support to fixed asset investment and related construction oriented projects.

Speaker Change: The team continues working through quality and yield issues theyre keeping costs at elevated levels.

Speaker Change: As for the energy market the solar industry continues to grow and be a meaningful market for both our flat rolled and long products minerals oil and gas activity remained steady with recent signs of increased activity for both flat rolled products and <unk> products.

Speaker Change: However, we expect these costs to moderate as we progress through the first half of the year, reaching positive earnings soon we.

Speaker Change: Also the additional two new value added coating lines are up and running improving sentence operating efficiencies value added product mix and through cycle capabilities.

Speaker Change: Continue to work on product development with <unk> capabilities to expand our flat rolled product offering.

Speaker Change: Also the additional two new value added coating lines are up and running improving citizen's operating efficiencies value added product mix and through cycle capabilities.

Speaker Change: Looking forward, we are optimistic regarding steel demand and pricing dynamics as we enter 2025.

Speaker Change: With that I'll turn that over.

Teresa: Thank you Barry Thank you Teresa.

Speaker Change: Yeah.

Speaker Change: So I believe it's more than evident that our performance driven team based culture in combination with our proven diversified and value added business model drives superior through cycle financial metrics.

Speaker Change: We reached a record high.

Speaker Change: Our specific automotive customer base has remained strong and our participation with this space has remained steady and in some cases growing this is for both flat rolled products and our automotive SBU customers.

This consistently strong operating and financial performance continues to support our cash generation and growth investment strategies, allowing a very balanced cash allocation strategy that has delivered the highest shareholder returns in our industry.

Speaker Change: To fleet in the United States continues to age and has now reached a record high.

Speaker Change: Our specific automotive customer base has remained strong and our participation with the space has remained steady and in some cases growing this is for both flat rolled products and our automotive SPG customers.

Speaker Change: Nonresidential construction remained stable with slowdowns across some industries. However, we believe moderating interest rates will unlock pent up project work and create new opportunities as we progress into 2025.

Speaker Change: Our disciplined investment approach continues to support a strong and growing through cycle cash generation profile, while maintaining the highest return on invested capital of our peers.

Speaker Change: Additionally, onshoring in infrastructure spending should provide further support to fixed asset investment and related construction oriented projects.

Speaker Change: As mentioned the full value added flat roll steel coating lines are increasing volume and performing very well from a quality perspective.

Speaker Change: As for the energy market the solar industry continues to grow and be a meaningful market for both our flat rolled and long products mills oil and gas activity remained steady with recent signs of increased activity for both flat rolled products and <unk> products.

Speaker Change: Additionally, onshoring in infrastructure spending should provide further support to fixed asset investment and related construction oriented projects.

Speaker Change: These types of high return investments are key to our value added product and supply chain differentiation strategies.

Speaker Change: The energy market the solar industry continues to grow and be a meaningful market for both our flat rolled and long product mills oil and gas activity remained steady with recent signs of increased activity for both flat rolled products and <unk> products.

Speaker Change: As we mentioned syndrome continues to improve its operational reliability with expectations with strong production and financial contribution in 2025.

Speaker Change: Looking forward were optimistic regarding steel demand and pricing dynamics as we enter 2025.

Speaker Change: With that I'll turn that over.

Speaker Change: And most recently our aluminum growth strategy is unfolding and is especially compelling.

Speaker Change: Super Thank you Barry Thank you Teresa.

Speaker Change: Looking forward, we are optimistic regarding steel demand and pricing dynamics as we enter 2025.

Speaker Change: Adi investment premise parallels our disruptive entry into the steel industry, some 30 years ago.

Speaker Change: So I believe it's more than evident that our performance driven team based culture in combination with a proven diversified our value add business model drives superior through cycle financial metrics.

Speaker Change: With that I'll turn that over.

Back then the market environment.

Speaker Change: Thank you Barry Thank you Teresa.

Speaker Change: Similar to the domestic aluminum.

Speaker Change: The environment today <unk>.

Speaker Change: This consistently strong operating and financial performance continues to support our cash generation and growth investment strategies blowing a very balanced cash allocation strategy that has delivered the highest shareholder returns in our industry.

Speaker Change: Older assets high legacy costs and efficient high cost operations.

Speaker Change: They've had a difficult earning difficulty earning their cost of capital over the years, Hence there has been little additional investment in facilities and technology.

Speaker Change: This consistently strong operating and financial performance continues to support our cash generation and growth investment strategies, allowing a very balanced cash allocation strategy that has delivered the highest shareholder returns in our industry.

We have somewhat of an arrogant customer approach.

Speaker Change: But unlike our entry into the over the oversupplied steel market. There was a significant north American supply deficit for aluminum sheet and it will continue to grow.

Speaker Change: As mentioned the full value added flat roll steel coating lines are increasing volume and performing very well from a quality perspective.

Speaker Change: There is a clear business alignment.

Speaker Change: Where we can leverage sdi's core competencies.

These types of high return investments are key to our value added product and supply chain differentiation strategies.

Our construction.

Knowhow is quite.

Speaker Change: As mentioned the full value added flat roll steel coating lines are increasing volume and performing very well from a quality perspective.

Speaker Change: As we mentioned Simpson continues to improve its operational reliability with expectations with strong production and financial contribution in 2025.

Speaker Change: Like persuasive.

Speaker Change: All you have to do is look at the the.

Speaker Change: Our rate of construction of this project and its absolutely remarkable.

Speaker Change: These types of high return investments are key to our value added product and supply chain differentiation strategies.

Speaker Change: And most recently all of them on growth strategy is unfolding and is especially compelling.

Speaker Change: And we also have operational knowhow.

Speaker Change: As we mentioned Simpson continues to improve its operational reliability with expectations with strong production and financial contribution in 2025.

Speaker Change: And a performance driven culture will drive higher efficiency and lower cost operations than our peers.

Speaker Change: Adi investment premise parallels our disrupt with entry into the steel industry, some 30 years ago.

Speaker Change: The project also levers omni sources recycling footprint, the largest north American aluminum scrap recycler.

Speaker Change: And most recently our aluminum growth strategy is unfolding and is especially compelling.

Speaker Change: Back then the market environment was similar to the domestic aluminum environment today older assets high legacy costs inefficient high cost operations.

Speaker Change: And they have done a great job here of late.

Adi investment premise parallels our disrupt its entry into the steel industry, some 30 years ago.

Speaker Change: Developing new separation technologies to separate the various lemon grades from the scrap stream, particularly the five and 6000 series from from automotive process scrubbed.

Speaker Change: Back then the market environment was similar to the domestic aluminum.

Speaker Change: Had a difficult earning difficulty earning their cost of capital over the years, hence there's been little additional investment in facilities and technology.

Speaker Change: Environment today older assets high legacy costs and efficient high cost operations they've.

Speaker Change: This is a meaningful investment as cost effective and our high return growth and diversification opportunity.

Speaker Change: They have somewhat of an arrogant customer approach.

Speaker Change: And but unlike our entry into the over the oversupplied steel market. There was a significant north American supply deficit for aluminum sheet and it will continue to grow.

Speaker Change: They've had a difficult earning difficulty earning their cost of capital over the years, Hence there has been little additional investment in facilities and technology.

Speaker Change: The property is no longer just the vision.

Speaker Change: We are quickly becoming a reality.

Speaker Change: Just look at the website.

Speaker Change: Have somewhat of an arrogant customer approach.

Speaker Change: There's a clear business alignment.

Speaker Change: We update that in I think.

Speaker Change: But unlike our entry into the over the oversupplied steel market. There was a significant north American supply deficit for aluminum sheet and it will continue to grow.

Speaker Change: Where we can leverage sdi's core competencies are.

Speaker Change: Almost a monthly basis.

Speaker Change: Just to think that we started digging in the ground July the fifth of the year before last somewhat 18 months ago is absolutely incredible the progress to date.

Speaker Change: Instructions.

Speaker Change: Knowhow is is a quite.

Speaker Change: Quite a persuasive.

Speaker Change: There is a clear business alignment.

Speaker Change: All you have to do is look at the the the rate of construction of this project and it is absolutely remarkable and we also have operational knowhow.

Speaker Change: Where we can leverage sdi's core competencies.

Speaker Change: Construction of the expensive mill in Columbus, Mississippi, as I said is extended extraordinary pace.

Speaker Change: Construction no.

Speaker Change: <unk> is quite.

And a performance driven culture will drive higher efficiency and lower cost operations than our peers.

Speaker Change: Like persuasive.

Speaker Change: SLP.

Speaker Change: All you have to do is look at the <unk>.

Speaker Change: Our slab cast house down there is also proceeding incredibly well and should be operational here in March March or April.

Speaker Change: Rate of construction of this project and its absolutely remarkable.

Speaker Change: The project also levers omni sources recycling footprint, they're the largest north American aluminum scrap recycler.

Speaker Change: And we also have operational knowhow.

Speaker Change: And a performance driven culture will drive higher efficiency and lower cost operations than our peers.

Speaker Change: The future customer base across all sectors is excited to have a new market entrant. There is known to be innovative customer centric and we're responsive to their needs.

Speaker Change: And they have done a great job here of late developing new separation technologies to two separate the various lemon grades from the scrap stream, particularly the five and 6000 series from from automotive process scrap.

Speaker Change: The project also levers omni sources recycling footprint, the largest north American aluminum scrap recycler.

Speaker Change: I have to emphasize after I talk to a bunch of the customers are the aluminum customers out there we will be innovative.

Speaker Change: And they have done a great job here of late.

Speaker Change: This is a meaningful investment is cost effective and our high return growth and diversification opportunity.

Speaker Change: Nothing new separation technologies to separate the various lemon grades from the scrap stream, particularly the five and 6000 series from from automotive process scrubbed.

Speaker Change: We will be incredibly responsive and provide best in class service, which will translate directly into customer value, we will be a differentiated supplier.

Speaker Change: The project is no longer just a vision.

Speaker Change: But quickly becoming a reality.

Speaker Change: This is a meaningful investment is cost effective and our high return growth and diversification opportunity.

Moses: Moses if just look at the website.

Speaker Change: Conversations with existing and new customers across the markets remain robust as they need and desire on new supply options.

Moses: We update that and I think on almost on a monthly basis and just to think that we started digging in the ground July the fifth of the year before last somewhat 18 months ago is it is absolutely incredible the progress to date.

Speaker Change: The project is no longer just a vision.

Speaker Change: As we strategically initiated at symptom with developing an onsite industrial park located aluminum processing in consuming facilities there.

Speaker Change: But quickly becoming a reality.

Speaker Change: Just look at the website.

Speaker Change: We update that I think.

Speaker Change: We've already announced one such relationship with Klossner, you will help service our automotive customers and we're currently negotiating a second arrangement that will result in approximately 100000 metric tons of annual onsite processing capability.

Speaker Change: A monthly basis.

Speaker Change: Just to think that we started digging in the ground July the fifth of the year before last somewhat 18 months ago is absolutely incredible the progress to date.

Moses: Construction of the expansive mill in Columbus, Mississippi, as I said is extended extraordinary pace.

Moses: S O P. R. A slab the cast house down there is also a proceeding incredibly well and should be operational here in March March or April.

Speaker Change: As our aluminum growth has become a visible reality.

Construction of the expensive mill in Columbus, Mississippi, as I said is extended extraordinary pace.

Speaker Change: And our reputation permeates the industry, we found aluminum professionals have been signing up to join this exciting project.

Moses: The future customer base across all sectors is excited to have a new market entrants. There is known to be innovative customer centric and we're responsive to their needs.

Our slab cost higher sedan is also proceeding incredibly well and should be operational here in March March or April.

Speaker Change: They are helping us build a phenomenal team.

Speaker Change: For combines in depth knowledge of aluminum flat roll operations, Illumina commercial markets and process technology, along with customer service.

Speaker Change: I have to emphasize after I talk to a bunch of the customers out the aluminum customers either we will be innovative.

Speaker Change: The future customer base across all sectors is excited to have a new market entrant there is known to be innovative customer centric.

Speaker Change: Which complements our STI professionals that will bring our performance driven culture davita.

Speaker Change: We will be incredibly responsive and provide best in class service, which will translate directly into customer value, we will be a differentiator supplier.

Speaker Change: Sponsor to their needs.

Speaker Change: As we've stated in the.

Speaker Change: And I have to emphasize after I talked to a bunch of the customers that the aluminum customers are that we will be innovative we will be incredibly responsive and provide best in class service, which will translate directly into customer value, we will be a differentiated supplier.

Speaker Change: In the past just recap the facility itself. It's a state of the art plant 650000 metric tons of flat roll capacity in Columbus, Mississippi.

Speaker Change: Conversations with existing and new customers across the markets room remain robust as they need and desire on new supply options.

Speaker Change: Mix will be around 300000 metric tonnes of can stock 230000 metric tons of automotive material and about 130000 tons of industrial and construction products.

Speaker Change: As we strategically initiated at Sinton, we're developing an onsite industrial park located aluminum processing in consuming facilities that.

Speaker Change: Conversations with existing and new customers across the markets remained robust as they need and desire on new supply options.

Speaker Change: We've already announced one social relationship with Clark now he will help service our automotive customers and we're currently negotiating a second arrangement that will result in approximately 100000 metric tons of annual onsite processing capability.

Speaker Change: Actually at Columbus, onsite melt caster slab capacity will be 600000 metric tons.

Speaker Change: As we strategically initiated at syndrome with developing an onsite industrial park located aluminum processing in consuming facilities, though.

Speaker Change: Ported by two satellite recycled aluminum slab casting centers.

Speaker Change: We've already announced one such relationship with Clark, who will help service our automotive customers and we're currently negotiating a second arrangement that will result in approximately 100000 metric tons of annual onsite processing capability.

Speaker Change: <unk> and Ubc's scrap rich regions.

Speaker Change: As our aluminum growth has become a visible reality.

Speaker Change: The project scope includes additional scrap processing and segregation technologies as I've already mentioned to maximize the aluminum recycled content.

Speaker Change: And our reputation permeates the industry, we found aluminum professionals have been signing up to join this exciting project.

Speaker Change: They are helping us build a phenomenal team.

Speaker Change: I will let my team is executing exceptionally well the team successfully passed the first industrial and beverage can in goods on comp task complex number one in Columbus. This past January the 12.

Speaker Change: As our aluminum growth has become a visible reality.

Speaker Change: Ah combines in depth knowledge of aluminum flat roll operations, Illumina commercial markets and process technology, along with customer service.

Speaker Change: And our reputation permeates the industry, we found aluminum professionals have been signing up to join this exciting project that.

Speaker Change: Which complements our STI professionals that will bring a performance driven culture davita.

Speaker Change: They are helping us build a phenomenal team.

Speaker Change: And we've had six or seven cast since and developing.

Speaker Change: That combines in depth knowledge of aluminum flat roll operations aluminum commercial markets and process technology, along with customer service.

Speaker Change: As we stated in the.

Speaker Change: Process variables for the different grades.

Speaker Change: In the past just a recap the the facility itself. It's a state of the art plant 650000 metric tons of flat roll capacity in Columbus, Mississippi.

Speaker Change: We plan to continue commissioning throughout the facility during the coming months.

Speaker Change: Which complements our SDI professionals that will bring our performance driven culture davita.

Speaker Change: So in produce commercially viable products before midyear 2025.

Speaker Change: As we stated in the.

Speaker Change: Production is expected to grow to a 50% annual run rate by the end of 2025 and.

Speaker Change: The mix will be around 300000 metric tonnes of can stock 230000 metric tons of automotive material and.

Speaker Change: In the past just recap the facility itself. It's a state of the art plant 650000 metric tons of flat roll capacity in Columbus, Mississippi.

Speaker Change: 75% capacity in 2026.

Speaker Change: I bet, a 130000 tons of industrial and construction products.

Speaker Change: Given current market conditions, we also expect to be a little EBITDA positive before year end 'twenty five.

Speaker Change: Next will be around 300000 metric tonnes of can stock 230000 metric tons of automotive material and about 130000 tons of industrial and construction products.

Speaker Change: Actually at Columbus onsite milk has the slab capacity will be 600000 metric tonnes supported by two satellite recycled aluminum slab casting centers located in Ubc's scrap rich regions.

Speaker Change: We expect through cycle annual EBITDA of around $650 to $700 million.

Speaker Change: Plus about $40 million to $50 million for the metals recycling platform.

Moses: Actually at Columbus, onsite melt caster slab capacity will be 600000 metric tons.

Speaker Change: The project scope includes additional scrap processing and segregation technologies as I've already mentioned to maximize alone recycled content.

Speaker Change: The most significant savings relative to our competition competition centered on four key areas labor savings hybrid higher recycled content significant process yield improvements and logistics.

Moses: Ported by two satellite recycled aluminum slab casting centers.

Moses: <unk> and Ubc's scrapped rich regions.

Speaker Change: I'll, let my team is executing exceptionally well the team successfully cast the first industrial and beverage can English zone comp cast complex number one in Columbus. This past January the 12.

Moses: The project scope includes additional scrap processing and segregation technologies as I've already mentioned to maximize the aluminum recycled content.

It.

Speaker Change: You can hardly be explained, but the excitement within our company is palpable.

Moses: <unk> team is executing exceptionally well the team successfully passed the first industrial and beverage can in goods on comp cast complex number one in Columbus. This past January the 12.

Speaker Change: And we've had six or seven cast since and are developing a process variables for the different grades.

Speaker Change: Especially within the Mississippian.

Speaker Change: San Luis Potosi aluminum sites and it grows as our teams recognize our ability to revolutionize the north American aluminum industry as we did in steel.

Speaker Change: We plan to continue commissioning throughout the facility during the coming months and to produce commercially viable products before midyear 2025.

Moses: And we've had six or seven cast since and developing.

Speaker Change: We are and passion by our current and future growth plans as they will continue to drive the high return growth momentum we have consistently demonstrated over the years.

Speaker Change: Process variables for the different grades.

Speaker Change: Production is expected to grow to a 50% annual run rate by the end of 2025 and <unk>.

Speaker Change: We plan to continue commissioning throughout the facility during the coming months.

Speaker Change: 75% capacity in 2026.

Speaker Change: The earnings growth of these new projects is compelling for <unk>.

Speaker Change: So in produce commercially viable products before midyear 2025.

Speaker Change: Given current market conditions, we also expect to be a little EBITDA positive before year end 'twenty five.

Speaker Change: Capital spending for symptom the full value add lines and aluminum dynamics is largely spent.

Speaker Change: Production is expected to grow to a 50% annual run rate by the end of 2025 and.

Speaker Change: With projected future through cycle EBITDA contribution of over $1 4 billion.

Speaker Change: We expect that through cycle annual EBITDA of around $650 to $700 million.

Speaker Change: 75% capacity in 2026.

Speaker Change: Given current market conditions, we also expect to be a little EBITDA positive before year end 'twenty five.

Speaker Change: Plus about $440 million to $50 million for the metals recycling platform.

Speaker Change: Due to an IMAX has grown to an incredibly resilient cash generating business of scale and diversification drew.

Speaker Change: The most significant savings relative to our competition competition center on four key areas labor savings hybrid higher recycled content significant process yield improvements and logistics.

Speaker Change: We expect through cycle annual EBITDA of around $650 to $700 million.

Speaker Change: Driven by the best teams in the World.

Speaker Change: And the last five years, we've invested billions of dollars in our organic strategic growth.

Speaker Change: Plus about $40 million to $50 million for the metals recycling platform.

Speaker Change: We've earned a return on invested capital of 24% compared to the S&P 500 that only 12% and.

Speaker Change: Okay.

Speaker Change: It's it can as it can hardly be explained with the excitement within our company is palpable.

Speaker Change: And way higher than the best of our peers steel peers.

Speaker Change: We've increased our cash dividend over 90%.

Speaker Change: Especially within the Mississippian zone, and San Luis Potosi aluminum sites and it grows as our teams recognize our ability to revolutionize the north American aluminum industry as we did in steel.

Speaker Change: We've repurchased over 30% of our outstanding shares.

Speaker Change: It is.

Speaker Change: All while maintaining best in class investment grade credit metrics.

Speaker Change: You can hardly be explained, but the excitement within our company is palpable.

Speaker Change: And creating stone outstanding value for our customers and suppliers our teams and our shareholders.

Speaker Change: Specialty within the Mississippian.

Speaker Change: We are impassioned by our current and future growth plans as they will continue to drive the high return growth momentum we have consistently demonstrated over the years.

Speaker Change: San Luis Potosi aluminum sites and it grows as our teams recognize our ability to revolutionize the north American aluminum industry as we did in steel.

Speaker Change: I am excited as investors recognize the power and consistency of our through cycle cash generation combined with our consistent and a high return on capital allocation strategy and.

Speaker Change: The earnings growth of these new projects is compelling.

Speaker Change: We are and passion by our current and future growth plans as they will continue to drive the high return growth momentum we have consistently demonstrated over the years.

Speaker Change: I know value us accordingly, more like industrial companies.

Speaker Change: Capital spending for symptom the full value add lines and aluminum dynamics is largely spent with.

Speaker Change: It is our belief that the steel industry has undergone a paradigm shift in recent years that will amplify this position.

Speaker Change: With projected future through cycle EBITDA contribution of over $1.4 billion.

Speaker Change: The earnings growth of these new projects is compelling.

Speaker Change: The capital spending for symptom the full value add lines and other dynamics is largely spent.

There is a pervasive sense of mercantilism.

Speaker Change: Children IMAX has grown to an incredibly resilient cash generating business of scale and diversification.

Speaker Change: That will provide a level playing field through continued an appropriate trade mechanisms.

Speaker Change: With projected future through cycle EBITDA contribution of over $1 4 billion.

Speaker Change: Driven by the best teams in the World.

Speaker Change: Risk mitigation to address numerous supply chain dislocations as accelerated re shoring of manufacturing.

Speaker Change: And the last five years, we've invested billions of dollars in our organic strategic growth.

Speaker Change: Steel dynamics has grown to an incredibly resilient cash generating business of scale and diversification driven.

Speaker Change: We've earned a return on invested capital of 24% compared to the S&P 500 at only 12% and.

AI and cloud computing will support nonresidential construction data centers chip factories battery plants and the like.

Speaker Change: Driven by the best teams in the World.

Speaker Change: And way higher than the best of our peers steel peers.

Speaker Change: And the last five years, we've invested billions of dollars in our organic strategic growth.

Speaker Change: Along with growing fixed asset investment associated with public dollars.

Speaker Change: We've increased our cash dividend over 90%.

Speaker Change: We've earned a return on invested capital of 24% compared to the S&P 500 at only 12% and.

Speaker Change: And lastly, decarbonization decarbonization will materially steepen, the global cost curve, providing student IMAX with a huge competitive advantage to gain market share.

Speaker Change: We repurchased over 30% of our outstanding shares.

Speaker Change: All while maintaining best in class investment grade credit metrics.

Speaker Change: And way higher than the best of our peers steel peers.

Speaker Change: We've increased our cash dividend over 90%.

Speaker Change: And creating a stone outstanding value for our customers and suppliers our teams and our shareholders.

Speaker Change: Increased metal spreads given our position of some of our sheet mills or the lowest carbon footprint in the world.

Speaker Change: We've repurchased over 30% of our outstanding shares.

Speaker Change: I'm excited as investors recognize the power and consistency of our through cycle cash generation combined with our consistent and high return capital allocation strategy.

Speaker Change: All while maintaining best in class investment grade credit metrics.

Speaker Change: This evolving metals business environment will amplify our earnings capability going forward.

Speaker Change: And creating stone outstanding value for our customers and suppliers our teams and our shareholders.

Speaker Change: We are blessed with good fortune people are our foundation.

Speaker Change: And no value us accordingly, more like industrial companies.

Speaker Change: I am excited as investors recognize the power and consistency of our through cycle cash generation combined with our consistent and high return capital allocation strategy and.

Speaker Change: Thank you to them for their passion and dedication.

Speaker Change: It is our belief that the steel industry has undergone a paradigm shift in recent years that.

Speaker Change: We're committed to them and I remind those listening today that safety for yourselves your families and each other as the highest priority.

Speaker Change: That will amplify this position.

Speaker Change: I know value us accordingly, more like industrial companies.

Speaker Change: It's a perverse, there's a pervasive sense of mercantilism.

Speaker Change: I would be remiss not to thank our loyal customers many of whom supported us since our inception, some 31 years ago.

Speaker Change: It is our belief that the steel industry has undergone a paradigm shift in recent years that.

Speaker Change: That will provide a level playing field through continued an appropriate trade mechanisms.

Speaker Change: These partnerships are based on trust on doing what we say, we will do creating new solutions to enhance the value proposition.

Speaker Change: That will amplify this position.

Speaker Change: Risk mitigation to address numerous supply chain dislocations as accelerated re shoring of manufacturing.

Speaker Change: There is a pervasive sense of mercantilism.

Speaker Change: That will provide a level playing field through continued an appropriate trade mechanisms.

Speaker Change: Our new aluminum partners will experience the same.

Speaker Change: AI and cloud computing will support nonresidential construction.

Speaker Change: And also our suppliers and service providers, who we value and trust. Thank you.

Speaker Change: Risk mitigation to address numerous supply chain dislocations as accelerated re shoring of manufacturing.

Speaker Change: Data centers chip factories battery plants and the like.

Speaker Change: Along with growing fixed asset investment associated with public dollars.

Speaker Change: Our culture and business model continue to differentiate our performance leading to best in class financial metrics.

Speaker Change: AI and cloud computing will support nonresidential construction.

Speaker Change: And lastly, decarbonization decarbonization will materially steepen, the global cost curve, providing student IMAX with a huge competitive advantage to gain market share in <unk>.

Speaker Change: For a circular metals business, providing enhanced lower carbon supply chain solutions, and turn mitigating volatility and cash flow generation through all market cycles, providing enhanced shareholder returns and value to all participants.

Data centers chip factories battery plants and the like.

Speaker Change: Along with growing fixed asset investment associated with public dollars.

Speaker Change: Kris metal spreads given our position in some of our sheet mills or the lowest carbon footprint in the world.

Speaker Change: And lastly, <unk> combination.

Speaker Change: <unk> will materially steepen, the global cost curve, providing student IMAX with a huge competitive advantage to gain market share.

Speaker Change: So we look forward to creating new opportunities for all of us today and in the years ahead.

Speaker Change: This evolving metals business environment will amplify our earnings capability going forward.

Speaker Change: <unk> metal spreads given our position of some of our sheet mills or the lowest carbon footprint in the world.

Speaker Change: But that said Matthew could be turn it over to questions. Please.

Speaker Change: We are blessed with good fortune now people are our foundation.

Speaker Change: Thank you if you'd like to ask a question. Please signal by pressing the star key followed by the digit one on your telephone keypad.

Speaker Change: Thank you to them for their passion and dedication.

Speaker Change: This evolving metals business environment will amplify our earnings capability going forward.

Speaker Change: We're committed to them and I remind those listening today that safety for yourselves your families and each other as the highest priority.

Speaker Change: We are blessed with good fortune people are our foundation.

Speaker Change: If you are using a speaker phone. Please make sure. Your mute function is turned off to allow your signal to reach our equipment.

Speaker Change: It would be remiss not to thank our loyal customers many of whom supported us since our inception, some 31 years ago.

Speaker Change: Thank you to them for their passion and dedication.

Speaker Change: If you press star one earlier during todays call. Please press star one again to ensure our equipment is captured your signal.

Speaker Change: We're committed to them and I remind those listening today that safety for yourselves your families and each other as the highest priority.

Speaker Change: These partnerships are based on trust on doing what we say, we will do creating new solutions to enhance the value proposition.

Speaker Change: Also we ask that you please limit yourself to one question to facilitate time for everyone.

I would be remiss not to thank our loyal customers many of whom supported us since our inception, some 31 years ago.

Speaker Change: Our new aluminum partners will experience the same.

Speaker Change: Any additional questions can be addressed upon reentering the queue.

Speaker Change: And also our suppliers and service providers, who we value and trust. Thank you.

Speaker Change: These partnerships are based on trust on doing what we say, we will do creating new solutions to enhance the value proposition.

Speaker Change: Your first question is coming from Tristan Gresser from BNP Paribas. Your line is live.

Speaker Change: Our culture and business model continue to differentiate our performance leading to best in class financial metrics.

Speaker Change: Our new aluminum partners will experience the same.

Tristan Gresser: Yes, hi, Thank you for taking my questions.

Speaker Change: And also our suppliers and service providers, who we value on trust. Thank you.

Speaker Change: We're a circular metals business, providing enhanced lower carbon supply chain solutions.

Speaker Change: Two.

The first one I was wondering if you witnessed any weather impact either on your operations.

Speaker Change: Our culture and business model continue to differentiate our performance leading to best in class financial metrics.

Speaker Change: In turn mitigating volatility and cash flow generation through all market cycles, providing enhanced shareholder returns and value to all participants.

Speaker Change: So far this year on demand dynamics.

Speaker Change: Our circular metals business, providing enhanced lower carbon supply chain solutions, and turn mitigating volatility and cash flow generation through all market cycles, providing enhanced shareholder returns and value to all participants so.

Speaker Change: And also what type of volume increase should we expect in steel and fabrication in Q1.

Speaker Change: So we look forward to creating new opportunities for all of us today and in the years ahead.

Matthew: But that said Matthew could be a turn it over to questions. Please.

Speaker Change: Got it.

Barry Schneider: Tristan This is Barry Schneider with regard to the weather.

Matthew: Thank you if you'd like to ask a question. Please signal by pressing the star key followed by the digit one on your telephone keypad.

Speaker Change: So we look forward to creating new opportunities for all of us today and in the years ahead.

Barry Schneider: It does definitely tightened up scrap just the availability to move it.

Matthew: But that said Matthew could be turn it over to questions. Please.

Matthew: If you're using a speaker phone. Please make sure your mute function is turned off to allow your signal to reach our equipment.

Barry Schneider: I know, there's a lot of discussions out there about energy and what's going on in the various.

Speaker Change: Thank you if you'd like to ask a question. Please signal by pressing the star key followed by the digit one on your telephone keypad.

Barry Schneider: Our regional transmission areas.

Matthew: If you press star one earlier during todays call. Please press star one again to ensure our equipment is captured your signal.

Barry Schneider: We haven't been significantly impacted we have a really good relationship with our both our utilities and our communities. So if there are emergencies, we have the ability to taper our usage, but it's been minimal to this point and we continue to work with cold weather as everybody else does a lot of our teams work outside.

Speaker Change: If you are using a speaker phone. Please make sure. Your mute function is turned off to allow your signal to reach our equipment.

Matthew: Also we ask that you please limit yourself to one question to facilitate time for everyone.

Speaker Change: If you press star one earlier during todays call. Please press star one again to ensure our equipment is captured your signal.

Matthew: Any additional questions can be addressed upon reentering the queue.

Matthew: Your first question is coming from Tristan Gresser from BNP Paribas. Your line is live.

Speaker Change: Also we ask that you please limit yourself to one question to facilitate time for everyone.

Barry Schneider: And could you repeat the second question. Please.

Barry Schneider: So yes, if you can share a bit of.

Tristan Gresser: Yes, hi, Thank you for taking my questions I have two.

Any additional questions can be addressed upon reentering the queue.

Barry Schneider: On the guidance for volumes.

Tristan <unk>: Your first question is coming from Tristan <unk> from BNP Paribas. Your line is live.

Barry Schneider: What should we expect for your steel business and your fabrication business.

Tristan Gresser: The first one I was wondering if you witnessed any weather impact either on your operations.

Barry Schneider: Sequentially into Q1.

Barry Schneider: Mr. Tristan.

Tristan <unk>: Yes, hi, Thank you for taking my questions.

Tristan Gresser: So far this year on demand dynamics.

Barry Schneider: As you know we gave limited guidance as it relates to things like that but as you look at the first quarter definitely and you look at some of the disruptions we had in the fourth quarter because as Barry mentioned, there was some weather impact with shipping as well with some of our steel divisions, but we would expect seasonally to see higher volumes.

Speaker Change: I have two.

Tristan Gresser: And also what type of volume increase should we expect in steel and fabrication Q1.

Speaker Change: The first one I was wondering if you witnessed any weather impact either on your operations. So far this year on demand dynamics.

Tristan Gresser: Let's start there.

Speaker Change: Tristan This is Barry Schneider with regard to the weather.

And also what type of volume increase should we expect in steel and fabrication Q1.

Speaker Change: It does definitely tightened up scrap just the availability to move it.

Barry Schneider: And in the first quarter.

Barry Schneider: More importantly, like looking beyond just a quarter, but looking towards 2025 is all three of US mentioned in our opening remarks.

Let's start there.

Speaker Change: I know, there's a lot of discussions out there about energy and what's going on in the various regional transmission areas.

Barry Schneider: Tristan This is Barry Schneider with regard to the weather.

Speaker Change: It does definitely tightened up scrap just the availability to move it.

Barry Schneider: Customers and our teams are really looking to see increased consumption in volume across the platforms in 2025.

Speaker Change: We haven't been significantly impacted we have a really good relationship with our both our utilities and our communities. So if if there are emergencies, we have the ability to taper our usage, but it's been minimal to this point and we continue just to work with cold weather as everybody else does a lot of our teams work outside.

Speaker Change: I know, there's a lot of discussions out there about energy and what's going on in the various regional transmission areas.

As it relates to some of the public funding, but I think more importantly, as it relates to maybe some additional debt.

Speaker Change: To date, we haven't been significantly impacted we have a really good relationship with our both our utilities and our communities. So if there are emergencies, we have the ability to taper our usage, but it's been minimal to this point and we continue to work with cold weather as everybody else does a lot of our teams work outside.

Barry Schneider: <unk> from reduced imports.

Barry Schneider: And from what we think will be a pretty robust construction environment, specifically in the second half of the year and then potentially some things from the administration as well. So we're more focused on the longer term than just quarter over quarter.

Speaker Change: And could you repeat the second question. Please.

Speaker Change: Well, yes, if you can share a bit of color on the guidance for volumes.

Speaker Change: What should we expect for your steel business and your fabrication business sequentially.

Speaker Change: And could you repeat the second question. Please.

Barry Schneider: Okay.

Speaker Change: Sequentially into Q1.

Barry Schneider: That's fair and maybe just another question on the hot dip galvanized trade case.

Speaker Change: Yes, if you can share a bit of.

Speaker Change: It's interesting.

Speaker Change: As you know we gave limited guidance as it relates to things like that but as you look at the first quarter definitely and you look at some of the disruptions we had in the fourth quarter because as Barry mentioned, there was some weather impact with shipping as well with some of our steel divisions, but we would expect seasonally to see higher volumes.

Speaker Change: Color on the guidance for volumes.

Can you explain why the investigation was asked to be delayed or is.

What should we expect for your steel business and your fabrication business.

Barry Schneider: Is that because there were signs that the tariffs may not be applied for.

Speaker Change: <unk> into Q1.

Speaker Change: It's interesting.

Barry Schneider: And also regarding the import situation. Obviously, there is a lot of chatter around potential tariffs have you witnessed some import balance.

Speaker Change: And in the first quarter and I think more importantly, like looking beyond just a quarter, but looking toward 2025 is all three of US mentioned in our opening remarks, the customers and our teams are really looking to see increased consumption in volume across the platforms in 2025.

Barry Schneider: Isn't weeks or.

Barry Schneider: Before the potential terrorists take place.

Barry Schneider: As regarding the timing that is pretty typically just pre.

Matthew: In the first quarter I think more importantly, like looking beyond just a quarter, but looking towards 2025 is all three of US mentioned in our opening remarks.

Barry Schneider: Procedural.

Barry Schneider: <unk>.

Barry Schneider: Event that happens with trade cases, theres, an incredible amount of data that has to be collected and then the government agencies have to tap to pour through that data. There are 10 different countries that were.

Speaker Change: As it relates to some of the public funding, but I think more importantly, as it relates to maybe some additional benefit.

Matthew: The customers and our teams are really looking to see increased consumption in volume across the platforms in 2025 as it relates to some of the public funding, but I think more importantly, as it relates to maybe some additional.

Speaker Change: Benefit from reduced imports and from what we think will be a pretty robust construction environment, specifically in the second half of the year and then potentially some things from the administration as well. So we're more focused on the longer term than just quarter over quarter.

Barry Schneider: Cases were filed against us.

Barry Schneider: And we have seen an important bump and in some cases just.

Barry Schneider: Being able to store any more material limits, what could come in but we have seen it we see it subsidizing right now.

Benefit from reduced imports and.

Matthew: What we think will be a pretty robust construction environment, specifically in the second half of the year and then potentially some things from the administration as well. So we're more focused on the longer term than just quarter over quarter.

Speaker Change: Okay, No that's fair.

Barry Schneider: <unk>.

Speaker Change: That's fair and maybe just another question on the hot dip galvanized trade case.

Barry Schneider: Regardless of what new trade actions that may happen with the administration. These cases are traditional cases that are based on regular commerce between countries. So we're expecting very favorable rulings and we do anticipate this.

Speaker Change: Can you explain why the investigation was asked to be delayed or is that because there were signs that the terrorists may not be applied for or and also regarding the import situation. Obviously, there's a lot of chatter around potential tariffs have you witnessed some import bounce in recent weeks or.

Matthew: Okay.

Speaker Change: That's fair and maybe just another question on the hot dip galvanized trade case.

Barry Schneider: Taking this unnecessary noise out of the marketplace as the rest of the world has struggled in certain areas with Slowdowns America becomes the place where these tons make their way so again normal cases.

Speaker Change: Can you explain why the investigation was ask.

To be delayed.

Speaker Change: Because there were signs that the tariffs may not be applied for or in.

Speaker Change: Before the those potential terrorists take place.

Tristan Gresser: Also regarding the import situation. Obviously, there is a lot of chatter around potential tariffs have you witnessed some.

Barry Schneider: We've got a process through the system like they always would and then whatever the administration does going forward, obviously, we'll react to and.

Speaker Change: As regarding the timing that is pretty typically just a procedural type.

Tristan Gresser: <unk> bounce in recent weeks or.

Speaker Change: Type.

Tristan Gresser: Before the potential terrorists take place.

Speaker Change: Event that happens with trade cases, theres, an incredible amount of data that has to be collected and then the government agencies have to tap to pour through that data. There are 10 different countries that were cases were filed against and we have seen an important bump and in some cases just.

Barry Schneider: Work with them.

Barry Schneider: Alright, perfect. Thank you very much.

Speaker Change: As regarding the timing that is pretty typically just procedural.

Speaker Change: Thank you. Your next question is coming from Timna Tanners from Wolfe Research Your line is live.

Speaker Change: Type.

Speaker Change: Went that happens with trade cases, theres, an incredible amount of data that has to be collected.

Timna Tanners: Good morning, and thanks for the detail I wanted to really understand better the situation is sitting in the finishing lines.

Speaker Change: And then the government agencies have to tap the pore through that data there are 10 different countries that were.

Speaker Change: Being able to store any more material limits, what could come in but we have seen it we see it subsidizing right now.

Timna Tanners: And the Q4 results you talked about certain.

Speaker Change: Cases were filed against and we have seen an import bump.

Timna Tanners: At 80% so it looks like great progress, there, but im not understanding why that's not more profitable that utilization and similar question for the finishing lines like what does it take to get to greater profitability. When should we see that that switchover and what could that contribution look like thanks a lot.

Speaker Change: Regardless of what new trade actions that may happen with the administration. These cases are traditional cases that are based on regular commerce between countries. So we're expecting very favorable rulings and we do anticipate this.

Speaker Change: And in some cases, just being able to store any more material limits what could come in but we have seen it we see it subsidizing right now and regardless of what new trade.

Barry Schneider: Timna this is Barry.

Speaker Change: Actions that may happen with the administration. These cases are traditional cases that are based on regular commerce between countries. So we're expecting very favorable rulings and we do anticipate this.

Speaker Change: Taking this unnecessary noise out of the marketplace as the rest of the world has struggled in certain areas with slowdowns.

Barry Schneider: It's interesting when we talk about the progress of certain I remain incredibly excited about what that team is doing and.

Speaker Change: America becomes the place where these tons make their way.

Barry Schneider: The throughput is a very large part of any cost compression any operations in our steel mills. So the gains we've seen on the hot side have really been excellent and it's really a function of our teams are really really working well together and our culture is being realized the mentoring that are.

Speaker Change: Again normal cases.

Speaker Change: Taking this unnecessary noise out of the marketplace as the rest of the world has struggled in certain areas with slowdowns.

Speaker Change: They're going to process through the system like they always would and then whatever the administration does going forward.

Speaker Change: <unk> becomes the place where these tons make their way.

Speaker Change: We'll react to and and work with them.

Speaker Change: Again normal cases.

Speaker Change: Alright, perfect. Thank you very much.

We've got a process through the system like they always would.

Speaker Change: Thank you. Your next question is coming from Timna Tanners from Wolfe Research Your line is live.

Speaker Change: Whatever the administration does going forward, obviously, we will react to them.

Other steel professionals, the men and women at all of our other steel plants have been going down there working with the <unk> team and what started early as basic education on equipment is now mentoring and the decision making they make every day drives the decision sort of floor and empowers the team to really make good decisions and and find their best practices.

Speaker Change: <unk> worked with them.

Timna Tanners: Hey, good morning, and thanks for the detail I wanted to really understand better the situation that's sitting in the finishing lines.

Speaker Change: Alright, perfect. Thank you very much.

Speaker Change: Thank you. Your next question is coming from Timna Tanners from Wolfe Research Your line is live.

Speaker Change: And the Q4 results you talked about sitting.

Timna Tanners: Good morning, and thanks for the detail I wanted to really understand better the situation is sitting in the finishing lines. So in the Q4 results you talked about certain at.

Speaker Change: At 80% so it looks like great progress, there, but I'm not understanding why that's not more profitable that utilization and similar question for the finishing lines like what does it take to get to greater profitability. When should we see that that switch over and what could that contribution look like thanks a lot.

Barry Schneider: She and reliability improvements also so as throughput has increased that definitely gives us a great opportunity.

Barry Schneider: Extraordinary cost right now are really a matter of a big part of our of the financial impact.

Speaker Change: At 80% so it looks like great progress, there, but im not understanding why that's not more profitable that utilization and similar question for the finishing lines like what does it take to get to greater profitability. When should we see that that switchover and what could that contribution look like thanks a lot.

Barry Schneider: And that extraordinary costs related to the reliability of the machine as well as improving the maintenance and the redundancies that are equipment needs. So as we've figured out where the weaknesses are.

Barry Schneider: Timna this is Barry.

Speaker Change: It is interesting when we talk about the progress of certain I remain incredibly excited about what that team is doing and the throughput is a very large part of any cost compression any operations in our steel mills. So the gains we've seen on the hot side have really been excellent and it.

Barry Schneider: We're putting money expensive money to put systems in place and people in place to make sure that the money. We're spending today reduces the money we need to spend in the future.

Barry Schneider: Timna this is Barry.

Speaker Change: It's interesting when we talk about the progress of certain I remain incredibly excited about what that team is doing.

Barry Schneider: These costs also have a direct impact on the quality.

Speaker Change: And the throughput is a very large part of any cost compression any operations in our steel mills. So the gains we've seen on the hot side have really been excellent and it's really a function of our teams are really really working well together and our culture is being realized the mentor.

Speaker Change: It's really a function of our teams are really are really working well together and our culture is being realized the mentoring that our other steel professionals the men and women at all our other steel plants have been going down there working with the sinton team and what started early as basic education on equipment is now mentoring and the dish.

Barry Schneider: And probably the single.

Speaker Change: Go specifically at your point about productivity.

Speaker Change: Productivity alone is great, but what we have to really do is drive yields and prime rates.

Speaker Change: As expensive commissioning, particularly downstream units because the products that are going to those lines as they start up a lot more value in them. So we continue to drive.

Speaker Change: During that our other steel professionals the men and women at all our other steel plants have been going down there working with the <unk> team and what started early as basic education on equipment is now mentoring and the decision, making they make everyday drives the decision sort of floor and empowers the team to really make good decisions and and find their best practice.

Speaker Change: Cision, making they make every day drives the decision sort of floor and empowers the team to really make good decisions and and find their best practices.

Speaker Change: More of our tons that we make leaving the plant on a prime order of high value that drives the mixed average selling price up so right now in the past bonds that sit in the hot side is operating at a prime rate that is actually exceeding our butler and Columbus plants Butler and Columbus are world class when it comes to attorney.

Speaker Change: She and reliability improvements also so as throughput has increased that definitely gives us a great opportunity.

Speaker Change: Extraordinary cost right now are really a matter of a big part of our of the financial impact.

Speaker Change: This machine reliability improvements also so as throughput has increased that definitely gives us a great opportunity.

Speaker Change: Every piece of <unk>.

Speaker Change: And that extraordinary costs related to the reliability of the machine as well as improving the maintenance and the redundancies that are equipment needs. So as we've figured out where the weaknesses are.

Speaker Change: Raw material coming into our plant into our prime shipment.

Speaker Change: Extraordinary cost right now are really a matter of a big part of our of the financial impact.

Speaker Change: We're also very focused on product development.

Speaker Change: So instead of just having one product line, we continue to try to.

Speaker Change: That extraordinary costs related to the reliability of the machine as well as improving the maintenance and the redundancies that are equipment needs. So as we've figured out where the weaknesses are.

Speaker Change: We're putting money expensive money to put systems in place and people in place to make sure that the money. We're spending today reduces the money we need to spend in the future. These costs also have a direct impact on the quality.

Speaker Change: Cost effectively.

Speaker Change: And conscientiously develop products that will help the productivity and the product offering that we have out of sinton. So the customer copper customers not going to compromise their needs. So as we commission the lines as we go through the acceptability and the new customer.

Speaker Change: And probably this is the single.

Speaker Change: Go specifically at your point about productivity.

Speaker Change: Productivity alone is great, but what we have to really do is drive yields and prime rates.

Speaker Change: New customer qualification processes with these new lines that does have a cost. So we're really excited with where we're at on the curve. It was ambitious but the addition of the two new licensing have allowed the bill to be more efficient. So as we work through these commissioning efforts of these approval processes more of the product leaves the plant.

Speaker Change: It's expensive commissioning, particularly downstream units because the products that are going to those lines as they start up have a lot more value in them. So we continue to drive.

Speaker Change: And probably the single.

Speaker Change: Go specifically at your point about productivity.

Speaker Change: Productivity alone is great, but what we have to really do is drive yields and prime rates.

Speaker Change: It's expensive commissioning, particularly downstream units because the products that are going to those lines as they start up of a lot more value in them. So we continue to drive.

Speaker Change: At high selling values.

Speaker Change: So that's a lot of what the CIT and cost is behind the productivity improvements.

Speaker Change: More of our tons that we make leaving the plant on a prime order of high value that drives the mixed average selling price up so right now in the past months. It sit in the hot side is operating at a prime rate that is actually exceeding our butler and Columbus plants Butler and Columbus are world class when it comes to turning.

Speaker Change: And I would say.

Speaker Change: Every piece of our <unk>.

Speaker Change: Raw material coming into our plant into our prime shipment.

Speaker Change: One one should focus on the step function improvement these past three months.

Speaker Change: We're also very focused on product development.

Speaker Change: So instead of just having one product line, we continue to try to.

Speaker Change: For them to be hitting.

Speaker Change: 80% and I think all last year, we said that mill would be operating at that rate by year end.

Speaker Change: <unk> every piece of.

Speaker Change: Raw material coming into our plant into our prime shipment.

Cost effectively.

Speaker Change: In conscientiously develop products that will help the productivity.

Speaker Change: We're also very focused on product development.

Speaker Change: So accomplish that.

Speaker Change: More recently, they've been operating in excess of 90%.

And the product offering that we have out of out of sinton.

Speaker Change: So instead of just having one product line, we continue to try to.

Speaker Change: Theyre getting 10000 tons.

Speaker Change: So the customer of copper by their customers docket of compromise their needs. So as we commission the lines as we go through the acceptability and the new cost of our new customer qualification processes with these new lines that does have a cost. So we're really excited with where we're at on the curve it.

Speaker Change: Cost effectively.

Speaker Change: Days Theyre getting 35, 36 string heat's on the.

Speaker Change: Conscientiously develop products that will help the productivity and the product offering that we have out of out of sinton. So the customer copper customers not going to compromise their needs. So as we commission the lines as we go through the acceptability and the new customer.

Speaker Change: On the cost of the performance there is literally shut up.

Speaker Change: Exponentially.

Speaker Change: And the fact that it hasnt made.

Speaker Change: Didn't make money in the fourth quarter is not atypical we're ramping up and the profitability is.

Speaker Change: Was ambitious but the addition of the two new lines as soon have allowed the bill to be more efficient. So as we work through these commissioning efforts of these approval processes more of the product leaves the plant at high selling values. So that's a lot of what the sinton cost is behind the productivity improvements.

Speaker Change: Very well.

Speaker Change: Well articulated follows.

Speaker Change: And our expectation is that profitability will be gained in the second quarter.

Barry Schneider: Just one thing to file I went to levels that everyone to Barry and Mark mentioned that.

Barry Schneider: And even though it's been a couple of years and it's still in startup mode, where once it gets to a fully mature facility, which will be later this year. It would be just like all of our other facilities. So as a reminder, our structural and rail division operated at less than 30% of its capacity and that 2009, great recession environment and they were.

Speaker Change: And I would say.

Speaker Change: That.

Speaker Change: Hi, selling values. So that's a lot of what the CIT and cost is behind the productivity improvements.

Speaker Change: 111 should focus on the step function improvement these past three months.

Speaker Change: For them to be hitting a 80% and I think we're all last year, we said that mill would be operating at that rate by it by year end and so accomplish that.

Speaker Change: And I would say.

Speaker Change: <unk>.

Speaker Change: One one should focus on the step function improvement these past three months.

Barry Schneider: And not just cash flow positive, but they were operationally positive from an earnings perspective as well. So we will get there and the teams or tease out here in the first half of the year.

Speaker Change: More recently, they've been operating in excess of 90%.

For them to be hitting.

Speaker Change: 80% and I think.

Speaker Change: Are they getting 10000 tonnes a day is they're getting 35 36 string here. So on the on the cost of the performance there is literally shut up.

Speaker Change: Last year, we said that mill would be operating at that rate by year end and so accomplish that.

Speaker Change: Okay. Thanks, Dan.

Speaker Change: Thank you. Your next question is coming from Lawson Winder from Bank of America. Your line is live.

Speaker Change: More recently, they've been operating in excess of 90%.

Speaker Change: They are getting 10000 tonnes a day.

Speaker Change: Exponentially.

Speaker Change: And the fact that it hasnt made a didn't make money in the fourth quarter is not atypical we're ramping up and the profitability is as Barry.

Speaker Change: As Theyre getting 35 36 string heat's on the on the cost of the performance there is literally shut up exponentially.

Speaker Change: Once again loss and your line is live.

Lawson Winder: Thank you very much operator, and good morning, Mark Theresa and Barry.

Speaker Change: Can I just ask on capital allocation priorities.

Speaker Change: And the fact that Hasnt made.

Speaker Change: Well articulated follows and our expectation is that profitability will be gained in the second quarter.

Speaker Change: Didn't make money in the fourth quarter is not atypical we're ramping up and the profitability is.

No.

Lawson Winder: It's a very.

Lawson Winder: Nice set up for steel dynamics heading into 2025, with a pretty material free cash and free cash flow inflection expected here.

Speaker Change: Just one thing to file I went to levels that everyone to Barry and Mark mentioned that thing even though it's been a you know a couple of years and it's still in that startup mode, where once it gets to a fully mature facility, which will be later this year. It would be just like all of our other facilities. So as a reminder, our structural and rail division operated at less than 30% of.

Speaker Change: Barry.

Barry Schneider: Well articulated follows and our expectation is that profitability will be gained in the second quarter.

Lawson Winder: Are there any new projects in the pipeline that could possibly be green lit in 2025.

Speaker Change: Just one thing to follow I want to level set everyone. So Barry and Mark mentioned that even.

Lawson Winder: <unk>.

Speaker Change: Even though it's been a couple of years and it's still in that startup mode, where once it gets to a fully mature facility, which will be later this year. It would be just like all of our other facilities. So as a reminder, our structural and rail division operated at less than 30% of its capacity and that 2009, great recession environment and they were.

Lawson Winder: And then on the other side of potential growth options, what is steel dynamics appetite to potentially acquire new capacity.

Speaker Change: Its capacity and that 2009, you know great recession environment and they were not just cash flow positive, but they were operationally positive from an earnings perspective, as well, so and we'll get there in the teens or achieve that here in the first half of the year.

Lawson Winder: Alright.

Lawson Winder: What was the second half of that question sorry.

Speaker Change: Okay. Thanks, Dan.

Lawson Winder: Oh M&A.

Speaker Change: Not just cash flow positive, but they were operationally positive from an earnings perspective as well. So we will get there and the teams or tease out here in the first half of the year.

Lawson Winder: Obviously.

Speaker Change: Thank you. Your next question is coming from Lawson Winder from Bank of America. Your line is live.

Lawson Winder: We have allocated a lot of a lot of cash to phenomenal growth.

Lawson Winder: Syndrome for new lines and aluminum and.

Speaker Change: Okay. Thanks, Dan.

Speaker Change: Once again loss and your line is live.

Lawson Winder: Being realized.

Lawson Winder: Thank you. Your next question is coming from Lawson Winder from Bank of America. Your line is live.

Lawson Winder: There is no.

Lawson Winder: Thank you very much operator, and good morning, Mark Theresa and Barry.

Lawson Winder: I'd say.

Lawson Winder: Imminent.

Lawson Winder: Large scale.

Speaker Change: Can I just ask on capital allocation priorities.

Lawson Winder: Organic growth anticipated right now.

Speaker Change: Once again loss and your line is live.

Lawson Winder: We have several projects but.

Lawson Winder: I mean, it's a very.

Lawson Winder: Nice set up for steel dynamics had heading into 2025 with a pretty material free cash and free cash flow inflection expected error.

Speaker Change: Thank you very much operator, and good morning, Mark Theresa and Barry.

Lawson Winder: Our focus currently is to execute execute execute.

Speaker Change: Can I just ask on capital allocation priorities. So.

Lawson Winder: Sinter and up and running.

Lawson Winder: Incredibly.

Lawson Winder: Well from a profitability standpoint.

Speaker Change: It's a very nice setup for steel dynamics heading into 2025.

Lawson Winder: Are there any new projects in the pipeline that could possibly be green lit in 2025.

Lawson Winder: Aluminum dynamics.

Lawson Winder: Running.

Lawson Winder: Got me, a fabulous Fabulous mill Fabulous investment and return for US. So that's that's our.

Speaker Change: A pretty material free cash and free cash flow.

Lawson Winder: And.

Lawson Winder: And then on the on the other side of potential growth options, what is steel dynamics appetite to potentially acquire new capacity.

Speaker Change: <unk> expected here.

Speaker Change: Yes.

Speaker Change: Are there any new projects in the pipeline that could possibly be green lit in 2025.

Lawson Winder: Media I guess focus.

Lawson Winder: For the team.

Lawson Winder: On the M&A front again, we.

Speaker Change: <unk>.

Speaker Change: And then on the <unk>.

Lawson Winder: Sorry, what was the what was the second half of that question sorry.

Speaker Change: Other side of potential growth options, what is steel dynamics appetite to potentially acquire new capacity.

Continue to look at opportunities as they come in and.

Lawson Winder: It's one where it makes sense then maybe we would look at it.

Lawson Winder: Oh M&A.

Lawson Winder: Obviously.

Lawson Winder: Nothing imminent right. This second.

Lawson Winder: We have allocated a lot of a lot of cash to a phenomenal growth.

Speaker Change: Alright.

Speaker Change: What was the second half of that question sorry.

Lawson Winder: Then would it be fair to conclude an absence of.

Lawson Winder: <unk> syndrome, the four new lines and aluminum and the.

Speaker Change: Oh M&A.

Lawson Winder: And audience new growth project and.

Obviously.

Lawson Winder: Being realized.

Speaker Change: We have allocated a lot of a lot of cash to phenomenal growth.

Lawson Winder: There is no.

Lawson Winder: No.

Lawson Winder: I would say.

Lawson Winder: Nothing obvious I guess for M&A.

Lawson Winder: Imminent.

Lawson Winder: Could cap.

Lawson Winder: Large scale.

Speaker Change: Since then the four new lines and aluminum and the.

Lawson Winder: Capital return accelerate then.

Lawson Winder: Organic growth anticipated right now.

Lawson Winder: Just given the setup for 2025.

Speaker Change: Being realized.

Lawson Winder: We have several projects, but our focus currently is to execute execute execute guests into an up and running.

Speaker Change: There is no.

Lawson Winder: Sure.

Lawson Winder: So often.

I would say.

Lawson Winder: Are absolutely a growth oriented company and we're very committed to our investment grade metrics and that being said we've had because of the the business model that we have that consistent cash flow generation allows us to really have meaningful shareholder returns. So.

Speaker Change: <unk>.

Speaker Change: Large scale.

Speaker Change: Organic growth anticipated right now.

Lawson Winder: Incredibly.

Lawson Winder: Well from a profitability standpoint.

Speaker Change: We have several projects but.

Lawson Winder: Get our aluminum dynamics up and running.

Speaker Change: Our focus currently is to execute execute execute.

Lawson Winder: It's a fabulous fabulous meal Fabulous investment and return for us. So that's the that's our.

Sinter and up and running.

Lawson Winder: I think <unk> seen that in the last 345 years and I don't see anything changing that absent something on that.

Speaker Change: Incredibly.

Speaker Change: Well from a profitability standpoint.

Lawson Winder: Uh huh.

Speaker Change: Aluminum dynamics.

Immediate I guess focus.

Lawson Winder: Unforeseen at this point in time, so it will be focused to mark and Barry's point on execution first and foremost.

Speaker Change: Running.

Lawson Winder: For the for the team.

Speaker Change: It's going be a fabulous Fabulous mill Fabulous investment and return for us. So that's that's our.

Lawson Winder: On the M&A front again, we continue to look at opportunities as they come in and.

Lawson Winder: But then you will continue to see us look to avail ourselves of what we think is a very attractively priced company by buying our own shares back by.

Speaker Change: Media I guess focus.

Lawson Winder: Yes. It is.

Lawson Winder: One would it make sense then maybe we would look at it but.

Speaker Change: For the team.

Speaker Change: On the M&A front again, we continue to look at opportunities as they come in and.

Lawson Winder: By keeping that positive dividend profile.

Lawson Winder: No nothing imminent right. This second.

Lawson Winder: Okay, great. Thank you.

Lawson Winder: Then would it be fair to conclude an absence of.

It's one where it makes sense then maybe we would look at it.

Speaker Change: Thank you. Your next question is coming from Alex hacking from Citi. Your line is live.

Lawson Winder: And audience new growth project and.

Speaker Change: Nothing imminent right. This second.

Lawson Winder: Hum.

Lawson Winder: No.

Lawson Winder: Nothing obvious I guess for M&A.

Speaker Change: Yes, Hi, Terry So can you just clarify the expectations for the aluminum mill in terms of production I think you said, 50%.

Speaker Change: Then would it be fair to conclude an absence of.

Lawson Winder: Good capital return and accelerate that.

Speaker Change: And audience new growth project and.

Lawson Winder: Just given the set up for according to my thoughts.

Speaker Change: No I mean.

Speaker Change: This year, 75% next year.

Lawson Winder: So often and you know we are absolutely a growth oriented company and we're very committed to our investment grade metrics and Naveen side, we've had because of the the business model that we have that consistent cash flow generation allows us to really have meaningful shareholder returns. So.

Speaker Change: Nothing obvious I guess for M&A.

Speaker Change: Is that sort of exit rate or is that average I.

Speaker Change: Good.

Speaker Change: Capital return and accelerate that.

Speaker Change: I guess put another way how many tonnes do you expect to ship this year and next year. Thanks.

Speaker Change: Just given the setup for 2025.

Lawson Winder: Yes.

Speaker Change: The the 50% for 25 is ending the year at a 50% utilization rate.

Lawson Winder: So often.

Lawson Winder: We are absolutely a growth oriented company and we're very committed to our investment grade metrics and that being said we've had because of the the business model that we have that consistent cash flow generation allows us to really have meaningful shareholder returns. So.

Lawson Winder: I think you've seen that in the last 345 years and I don't see anything changing that absent something that's.

Speaker Change: 75%.

Speaker Change: For 2006 as a total.

Lawson Winder: I'm foreseen at this point in time, so we'll be focused to mark and Barry's point on execution first and foremost, but then you will continue to see us look to avail ourselves of what we think is a very attractively priced company by buying our own shares back and by keeping that positive dividend profile.

Speaker Change: Yeah.

Speaker Change: Capability.

Lawson Winder: <unk> seen that in the last 345 years and I don't see anything changing that absent something that's.

Speaker Change: Okay.

Okay. Thank you and then just a follow up if I might on the Fab segment margins were very stable. There last year actually you know around 37% to 40% EBITDA margin. If my math is correct I mean is it.

Speaker Change: Unforeseen at this point in time, so we will be focused to mark and Barry's point on execution first and foremost.

Lawson Winder: But then you will continue to see us look to avail ourselves of what we think is a very attractively priced company by buying our own shares back.

Lawson Winder: Okay, great. Thank you.

Speaker Change: Is it too early to call that a new normal.

Speaker Change: It's obviously a lot higher than it was pre COVID-19 lower than that kind of peak COVID-19, yes, but.

Speaker Change: Thank you. Your next question is coming from Alex hacking from Citi. Your line is live.

Lawson Winder: And by keeping that positive dividend profile.

Speaker Change: Surprising amount of stability there any comments would be helpful. Thank you.

Speaker Change: Yes, Hi, Terry So can you just clarify the expectations for the aluminum Mel and sample production I think you said, 50%.

Lawson Winder: Okay, great. Thank you.

Speaker Change: So.

Speaker Change: Alex as we've talked about it in the past, we do believe that that whole industry went through a commercial change.

Speaker Change: Thank you. Your next question is coming from Alex hacking from Citi. Your line is live.

This year, 75% next year.

Speaker Change: Yes, Hi, Terry So can you just clarify the expectations for the aluminum mill in terms of production I think you said, 50%.

Speaker Change: As it relates to pricing and what that means and what I mean by that is that there was a product and a service that was probably not probably was underpriced pre COVID-19 and there wasn't a recognition of the engineering and the value add that as a part of that so yes. We right now if you look at 2024 are those volumes are.

Speaker Change: Is that sort of exit rate or is that average up.

Speaker Change: Put another way like how many tons do you expect to ship this year and next year. Thanks.

Lawson Winder: This year, 75% next year.

Speaker Change: But the the 50% for twenty-five is ending the year at a 50% utilization rate.

Speaker Change: Is that sort of exit rate or is that average I.

Lawson Winder: I guess put another way how many tonnes do you expect to ship this year and next year. Thanks.

Speaker Change: 75%.

Speaker Change: Actually pretty low even for pre Covid and we would expect to see that change in 2025 and in the out years as we start to see what we believe is an environment that will support increased fixed asset investment, which will therefore, absolutely support increased steel consumption steel joist and deck consumption and therefore.

Lawson Winder: But the the 50% for 25 is ending the year at a 50% utilization rate.

Speaker Change: 26 as a total.

Speaker Change: Capability.

Speaker Change: Okay. Thank you and then just a follow up if I might on the fab segment.

Lawson Winder: 75%.

Lawson Winder: For 2006 as a total.

Lawson Winder: Total sales.

Speaker Change: Margins were very stable there last year actually you know around 37% to 40% EBITA margin. If my math is correct.

Lawson Winder: Capability.

Speaker Change: More scrap required in the U S as well so we see this as a pretty stabilized period of time with margins are going to be higher on a go forward basis and on a mid cycle basis.

Lawson Winder: Okay. Thank you and then just a follow up if I might on the <unk>.

Speaker Change: And is it is it too early to call that a new normal.

Lawson Winder: <unk> segment.

Lawson Winder: Margins were very stable there last year actually around 37% to 40% EBITDA margin. If my math is correct.

Speaker Change: It's obviously a lot higher than it was pre COVID-19 lower than that kind of peak COVID-19, yes, but.

Speaker Change: Surprising amount of stability there any comments would be helpful. Thank you.

Speaker Change: Okay. Thank you.

Lawson Winder: Is it is it too early to call that a new normal.

Speaker Change: So I you know Alex as we talked about it in the past, we do believe that that whole industry went through a commercial change them as it relates to pricing and what that means and what I mean by that is that there was up a product and a service that was probably not probably was underpriced on pre COVID-19.

Speaker Change: Thank you. Your next question is coming from Bill Peterson from Jpmorgan. Your line is live.

Lawson Winder: Obviously, a lot higher than it was pre COVID-19 lower than that kind of peak COVID-19, yes, but.

Lawson Winder: Pricing amount of stability there any comments would be helpful. Thank you.

Speaker Change: Good morning. This is Ben on for Bill. Thank you for taking my questions I wanted to get your thoughts on recent tightness in UPC scrap spreads and what this could be a structural trend with greater demand from two new rolling those ramping yet.

Speaker Change: So Alex as we talked about it in the past, we do believe that that whole industry went through a commercial change.

Speaker Change: And there wasn't a recognition of the engineering and the value add that's a part of that so yes are we right now if you look at 2024 are those volumes are actually pretty low even for pre COVID-19 and we would expect to see that change in in 2025 and in the out years as we start to see what we believe is an environment that will support increased.

Speaker Change: China recently, removing scrap import controls and if you could also remind us what the expected scrap intensity will be across the three product groups out of Adi.

Lawson Winder: As it relates to pricing and what that means and what I mean by that is that there was a product and a service that was probably not probably was underpriced pre COVID-19 and there wasn't a recognition of the.

Speaker Change: Well, we don't anticipate this being a new a new norm.

Lawson Winder: The engineering and the value add thats, a part of that so yes.

Lawson Winder: We right now if you look at 2024 are those volumes are actually pretty low even for pre COVID-19 and we would expect to see that change in 2025 and in the out years as we start to see what we believe is an environment that will support increased fixed asset investment, which will therefore, absolutely support increased steel consumption.

Speaker Change: Okay.

Speaker Change: Fixed asset investment, which will therefore, I'm absolutely support increased steel consumption steel joist and deck consumption and therefore, no more scrap required in the U S. As well. So we see this as a pretty stabilized period of time with margins that are going to be higher on a go forward base.

Speaker Change: Scrap steel scrap.

Speaker Change: They are incredibly efficient effective markets.

Speaker Change: There is I think.

Speaker Change: Some emotion out there as we're getting into the market.

Speaker Change: And people are doing.

Speaker Change: Some strange things.

Speaker Change: But I think it will normalize over time.

Lawson Winder: <unk> steel joist and deck consumption and therefore more scrap required in the U S. As well. So we see this as a pretty stabilized period of time with margins are going to be higher on a go forward basis and on a mid cycle basis.

Speaker Change: This isn't on a mid cycle basis.

Speaker Change: The.

Speaker Change: Okay. Thank you.

Speaker Change: The scrap across the.

Bill Peterson: Thank you. Your next question is coming from Bill Peterson from Jpmorgan. Your line is live.

Speaker Change: Individually I would say, we're looking at for for Comstock at around 95%.

Bill Peterson: Good morning. This is Ben on for Bill. Thank you for taking my questions I wanted to get your thoughts on recent tightness in UPC scrap spreads and whether this could be a structural trend with greater demand from two new Rolling mill is ramping in China recently, removing scrap import controls and if you could also remind us what the expected scrap intensity will be.

Lawson Winder: Okay. Thank you.

Speaker Change: Utilization.

Speaker Change: Utilization recycled content.

Speaker Change: Thank you. Your next question is coming from Bill Peterson from Jpmorgan. Your line is live.

Speaker Change: And when you get to the automotive grades probably if I remember correctly around 60% 65%.

Speaker Change: Good morning. This is Ben on for Bill. Thank you for taking my questions I wanted to get your thoughts on recent tightness in UPC scrap spreads and whether this could be a structural trend with greater demand from two new rolling those ramping in China recently, removing scrap import controls and if you could also remind us what the expected scrap intensity will be.

Speaker Change: Again, we are absolutely focused on.

Bill Peterson: Across the three product groups out of Adi.

Speaker Change: Invest in class there.

Speaker Change: We do have omni source the largest aluminum.

Bill Peterson: Okay.

Bill Peterson: Well, we don't anticipate this being a new a new norm.

Speaker Change: <unk>.

Speaker Change: With America today.

Speaker Change: They've come up with novel sorting segregation capabilities, just as we have over the years for for steel scrap.

Speaker Change: Across the three product groups out of Adi.

Speaker Change: Aluminum scrap steel scrap they are.

Speaker Change: They are incredibly efficient effective markets.

Speaker Change: Well.

Speaker Change: We don't anticipate this being a new a new norm.

Speaker Change: There is I think some emotion out there as we're getting into the market and people are doing some some strange things.

Speaker Change: The shredded obsolete flow.

Speaker Change: They are achieving the same same.

Speaker Change: Aluminum scrap steel scrap.

Speaker Change: Capabilities.

Speaker Change: They are incredibly efficient effective markets.

Speaker Change: Two of them. So there is absolutely no doubt we will be best in class going forward.

Speaker Change: But I think it will normalize over time.

Speaker Change: There is I think.

Speaker Change: Some emotion out there as we're getting into the market and people are doing.

Thank you for that detail and as we think about losses moving forward I think in the past it was guided to around $25 million a quarter, we were a bit above that in the fourth quarter is that still a good guidepost or could we see them continuing to move higher.

Speaker Change: The.

Speaker Change: The scrapping across the.

Speaker Change: Some strange things.

Speaker Change: And individually I would say, we're looking at for for Comstock at around 95%.

Speaker Change: But I think it will normalize over time.

The.

Speaker Change: The scrap across the.

Speaker Change: The utilization utilization recycled content.

Speaker Change: So as it as it relates to that and as we ramp up in the first half of the year you will see some incremental increase I think for the first quarter, it's still going to likely be in that $30 million to $35 million range, but as they start to operate you will see additional expenses come through until it's offset with sales which mark.

Speaker Change: Individually I would say we're looking at.

Speaker Change: And when you get to the the automotive grades probably if I remember correctly around 60, 65%.

Speaker Change: For Comstock at around 95%.

Utilization utilization.

Speaker Change: Utilization recycled content.

Speaker Change: Again, we are absolutely focused on.

Speaker Change: And when you get to the automotive grades probably if I remember correctly around 60% 65%.

Speaker Change: Being best in class there.

We do have omni source, the largest aluminum a recycler in North America today.

Mentioned earlier should start in the June timeframe, so I'm, a little bit of incremental increase first half of the year before we start to see offsets from operations.

Speaker Change: Again, we are absolutely focused on.

They've come up with some for novel sorting segregation capabilities, just as we have over the years for for steel scrap and the shredded obsolete flow.

Speaker Change: Invest in class there.

Speaker Change: Yeah.

Speaker Change: We do have omni source the largest aluminum.

Speaker Change: Thank you very much best of luck.

Speaker Change: <unk> in North America today.

Speaker Change: Thank you. Your next question is coming from John Tumazos from Tumazos very independent research. Your line is live.

Speaker Change: They were achieving the same same.

Speaker Change: They've come up with some phenomenal sorting segregation capabilities just as we have over the years for for steel scrap and the.

Speaker Change: Capabilities and lose them. So there's absolutely no doubt we will be best in class there going forward.

Speaker Change: Thank you.

Speaker Change: Could you give us some color.

Speaker Change: Treaded obsolete flow.

Speaker Change: Contrast thing the lightning grip blitzkrieg startup for the aluminum.

Speaker Change: They are achieving the same same.

Speaker Change: Thank you for that detail and as we think about losses moving forward I think in the past it was guided to around $25 million a quarter, we were a bit above that in the fourth quarter is that still a good guide post or could we see them continuing to move higher thank you.

Speaker Change: Capabilities.

Speaker Change: Versus set and where were in the fourth year.

Speaker Change: So there is absolutely no doubt, we will be best in class going forward.

Speaker Change: Who are the equipment suppliers, primarily for aluminum versus for certain.

Speaker Change: Yeah.

Speaker Change: So as it as it relates to that and as we ramp up in the first half of the year you will see some incremental increase I think you know for the first quarter, it's still going to likely be in that $30 million to $35 million range, but as they start to operate you will see additional expenses come through until it's offset with sales, which mark mentioned.

Speaker Change: And the issues at certain that the product mix is different than anticipated.

Speaker Change: Narrower coils.

Speaker Change: Or more batch or tougher to procure scrap or.

Bill Peterson: So as it as it relates to that and as we ramp up in the first half of the year you will see some incremental increase I think for the first quarter, it's still going to likely be in that $30 million to $35 million range, but as they start to operate you will see additional expenses come through until it's offset with sales, which mark mentioned.

Speaker Change: If there is non prime steel is it because of dirty scrap or.

Speaker Change: The melt shop, not getting the chemistry, right or the rolling practice.

Speaker Change: Earlier should start in the June timeframe, so I'm, a little bit of incremental increase first half of the year before we start to see offsets from operations.

Speaker Change: It's just such a contrast aluminum is ahead of schedule and we are where we are uncertain.

Speaker Change: Yeah.

Speaker Change: Thank you very much best of luck.

Bill Peterson: Earlier should start in the June timeframe, so I'm, a little bit of incremental increase first half of the year before we start to see offsets from operations.

Speaker Change: Hi, John.

John Tumazos: Great to hear from you and thanks for supporting Us and being on the call.

Speaker Change: Thank you. Your next question is coming from John Tumazos from Tumazos very independent research. Your line is live.

Speaker Change: You always are.

Bill Peterson: Yeah.

Speaker Change: I think the the two projects are.

Bill Peterson: Thank you very much best of luck.

Speaker Change: Thank you.

Speaker Change: Very very different from a.

Speaker Change: Could you give us some color.

Speaker Change: Thank you. Your next question is coming from John Tumazos from Tumazos very independent research. Your line is live.

Speaker Change: Startup ramp up utilization.

Speaker Change: Contrasting the lightning grip blitzkrieg startup for the aluminum.

Perspective, I guess.

Speaker Change: If you look at Simpson that was a.

Speaker Change: Versus certain more were in the fourth year.

Speaker Change: Thank you.

Speaker Change: Essentially a new technology.

Speaker Change: Could you give us some color.

Speaker Change:

Speaker Change: Who were the equipment suppliers, primarily for aluminum versus for certain.

Speaker Change: On the cost of that is generation I don't know, whether we generally call it generation three or four or five or whatever it is.

Speaker Change: Contrasting the lightning grip blitzkrieg startup for the aluminum.

Speaker Change: Versus more were in the fourth year.

Speaker Change: And the issues at certain that the product mix is different than anticipated.

Speaker Change: But that is absolutely at the forefront of any technology for that sort of a mill in the world.

Speaker Change:

Speaker Change: Who are the equipment suppliers, primarily for aluminum versus for certain.

Speaker Change: Narrower coils.

Speaker Change: People are coming to us and all.

Speaker Change: Or more battery or tougher to procure scrap or.

Speaker Change: In all honesty.

Speaker Change: Yeah.

Speaker Change: And the issues at certain that the product mix is different than anticipated narrower coils.

Speaker Change: Wanting to replicate it.

Speaker Change: If there is non prime steel or is it because of dirty scrap or.

Speaker Change: In Europe and in Asia.

Speaker Change: With that new technology comes risk and issues and challenges.

Speaker Change: The melt shop, not getting the chemistry, right or the rolling practice.

Speaker Change: Or more batch or tougher to procure scrap or.

Speaker Change: And given that as you know CSP plant is a continual process from from the very beginning.

Speaker Change: It's just such a contrast aluminum is ahead of schedule on where we are where we are in certain.

Speaker Change: If there is non prime steel is it because of dirty scrap or.

Speaker Change: The melt shop, not getting the chemistry, right or the rolling practice.

Speaker Change: Mel metal refining casting.

Speaker Change: Well, John Great to hear from you and thanks for supporting Us and being on the call as yours are.

Speaker Change: Britt mill.

Speaker Change: It's just such a contrast aluminum is ahead of schedule and we are where we are uncertain.

Speaker Change: Any any bug any.

Speaker Change: And he made some as issue any shutdown issue shuts the homebuilder.

Speaker Change: I think the the two projects are a very very different from a.

John: Well John.

Speaker Change: Could you compare and contrast that with the.

Speaker Change: Great to hear from you and thanks for supporting Us and being on the call.

Speaker Change: Startup ramp up utilization.

Speaker Change: The aluminum mill the aluminum mill is state of the art technology.

Speaker Change: Perspective, I guess.

Speaker Change: As you always are.

Speaker Change: I think the the two projects are.

Speaker Change: But there's nothing new there.

Speaker Change: If you look at Simpson that was a sn.

Speaker Change: Certainly way way way ahead of any technology in the U S for sure but in Asia in China. These mills the equipment.

Speaker Change: Very very different from a.

Speaker Change: Essentially a new technology.

Speaker Change: Startup ramp up utilization.

Speaker Change: On the cost of that is generation I don't know, whether we generally call it generation three or four or five or whatever it is.

Speaker Change: Perspective, I guess.

Speaker Change: If you look at Simpson that was.

Speaker Change: That that is absolutely at the forefront of any technology for that sort of a mill in the world.

Speaker Change: The SMS equivalent.

Speaker Change: Essentially a new technology.

Speaker Change: It's been supplied quite quite broadly so it will not.

Speaker Change: On the cost of that is generation I don't know, whether we generally call it generation three or four or five or whatever it is.

Speaker Change: But we're not.

Speaker Change: People are coming to us and all in.

Speaker Change: Revolutionize that.

Speaker Change: In all honesty.

Speaker Change: <unk> on your technology, the design of the plant layout of the plant.

Speaker Change: But that is absolutely at the forefront of any technology for that sort of a mill in the world.

Speaker Change: Wanting to replicate it in Europe and in Asia.

Speaker Change: There's a lot more effective.

Speaker Change: With that new technology comes risk and issues and challenges and.

Speaker Change: Fishing for sure.

People are coming to us and all.

Speaker Change: There's a lot more batch.

In all honesty.

Speaker Change: As a batch nature to it.

Speaker Change: So for instance on the on the mill melting and casting side of it we have four for.

Speaker Change: Four units in Columbus or have a fifth unit.

Speaker Change: San Luis Potosi.

Speaker Change: A 60 unit.

Speaker Change: On the on the West Coast.

Speaker Change: So again you lose one you'll have a problem with one another that's not going to impact the startup for the for the next two years, even if you. If you are missing a couple of those those.

Speaker Change: And it's.

Speaker Change: So it is a.

Issue shuts the whole millner.

Speaker Change: Definitely a different beast.

Speaker Change: Could you compare and contrast that with the.

Speaker Change: And we do expect that that startup to be quite good.

Speaker Change: The aluminum mill the aluminum mill is state of the art technology.

Speaker Change: Quite rapid.

John Tumazos: John if I could add.

Speaker Change: But.

Speaker Change: Quality coming out of CIT and we're actually quite pleased we made this technology decision because of where we see the products being needed in the United States. So we've been very happy with high strength products that could that product development is going very well.

Speaker Change: And not to get too specific but high strength steels are various which are under demand because that allows you to lighten the weight of things.

What we're not.

Revolutionize that we're pioneering a new technology the design of the plant layout of the plant.

Speaker Change: We're also seeing really good.

Speaker Change: Sponsor the melting side the steelmaking at that plant is very good.

Speaker Change: A lot more effective.

Speaker Change: Fishing for sure.

And there's a lot more batch.

Speaker Change: But as Mark spoke when you have continuous process. If you have an issue anywhere amongst the main hot side units.

Speaker Change: The batch nature to it.

Speaker Change: So for instance on the on the milk melting and casting side of it we have four.

Speaker Change: The whole side shuts down so as the team gets better at making good decisions and.

Speaker Change: Four units in Columbus or have a fifth unit in.

Speaker Change: And operating with confidence that's where we've seen these incredible gains that's what the rest of our steelmaking team goes down there to support its mentoring they know what theyre doing theyre, just making better and better decisions, but we're very happy with the quality.

Speaker Change: San Luis Potosi, and wherever <unk> unit.

Speaker Change: On the West Coast.

David: Again, you lose one you'll have a problem with one another.

David: Not going to impact the start up to the.

David: Two years, even if you.

Speaker Change: We're happy with the.

David: If you are missing a couple of those those.

Speaker Change: Should we see a boom in pipe and tube were developing those products because we have to be able to service all of those markets. So we're excited about where we're at we're excited with how the technology performs.

David: Those units.

David: It is.

Definitely a different beast.

David: And we do expect that that startup to be quite.

David: Quite rapidly.

Speaker Change: And it's been a rocky road, but at the same time, sometimes when you're first you have these experiences.

David: But John if I could add.

Speaker Change: The quality coming out of <unk>.

Speaker Change: But we continue to put more and more capabilities in the mill. So our sales team could go into the marketplace with those.

David: And we're actually quite pleased we made this technology decision because of where we see the the products being needed in the United States. So we've been very happy with high strength products that could that product development is going very well.

Speaker Change: Thank you.

Speaker Change: Thank you. Your next question is coming from Timna Tanners from Wolfe Research Your line is live.

Speaker Change: And not to get too specific but high strength steels are various width are under demand because that allows you to lighten the weight of things were.

Timna Tanners: Hey, I had a follow up if I could just wanted to look at your balance sheet I know a year ago. At this time, you said that you were planning to keep buyback steady year over year and you did that.

David: We're also seeing really good.

David: Sponsor the melting side the steelmaking at that plant is very good.

Speaker Change: Your cash and short term investment position.

David: But as Mark spoke when you have continuous process. If you have an issue anywhere amongst the main hot side units.

Speaker Change: As far as I can see was the lowest in a decade is that an appropriate level.

David: The whole side shuts down so as the team gets better at making good decisions and.

Speaker Change: Do you think that you would keep.

Speaker Change: Buyback steady from recent years helpful. Thanks, a lot.

And operating with confidence that's where we've seen these incredible gains that's.

Speaker Change: Well I'm not sure it's the lowest in a decade, but I've been here too long been here like 26 years.

David: That's what the rest of our steelmaking theme goes down there to support its entering.

Speaker Change: That being said.

Speaker Change: We feel very comfortable with the capital structure and the capital Foundation, we do have another tranche of notes that are maturing here in the second quarter.

David: They know what Theyre doing theyre, just making better and better decisions, but we're very happy with the quality.

David: We're happy with the.

David: Should we see a boom in pipe and tube were developing those products because we have to be able to service all of those markets. So we're excited about where we're at we're excited with how the technology performs.

Speaker Change: So we'll be looking to refinance those but yes, timna, we still plan on having a very active share repurchase program.

Speaker Change: Along with the complementary dividend increasing profile simply because as we start to see again, the fruition and Mark mentioned in his opening comments, we have in the last three years spent our last five years, but money for organic growth now we're going to start seeing the benefit from a cash stream perspective and in earnings.

David: And it's been a rocky road, but at the same time, sometimes when you're first you have these experiences.

David: But we continue to put more and more capabilities in the mill. So our sales team could go to the marketplace with those.

David: Thank you.

Timna Tanners: Thank you. Your next question is coming from Timna Tanners from Wolfe Research Your line is live.

Speaker Change: Stream perspective in 2025 and that will be a great.

Speaker Change: Hey, I had a follow up if I could just try to look at your balance sheet at year ago. This time, you said that you are planning to keep buyback steady year over year and you get that.

Speaker Change: Resource for us to continue to again as I mentioned buyback company that we think is pretty well run at a pretty significant discounts. So we don't see anything like that we don't see anything changing from this point forward.

Speaker Change: And of your cash and short term investment position as far as I can see was the lowest in a decade is that an appropriate level.

Speaker Change: Thank you that concludes our question and answer session I would like to turn the call back over to Mr. Millett for any closing remarks.

Teresa: And do you think that you would keep.

David: Buyback steady from recent years helpful. Thanks, a lot.

Mr. Millett: Well again, thank you everyone for joining us and I guess.

Speaker Change: Well I'm not sure it's the lowest in a decade that I've been here too long zenger like 26 years.

Mr. Millett: As I reflect on.

David: Pat.

Mr. Millett: On these calls tend to get driven into sort.

We feel very comfortable with the capital structure and the capital Foundation, we do have another chance.

Mr. Millett: Sort of detail near term detail.

Mr. Millett: But just to acknowledge those that.

David: Note that are maturing here in the second quarter.

Mr. Millett: Our shareholders and those analysis analysts that.

Timna Tanners: And so we'll be looking to refinance those but yes, timna, we still plan on having a very active share repurchase program.

Literally started looking at us.

Mr. Millett: The metals business.

Speaker Change: Hum along with the complementary <expletive>.

Mr. Millett: More of a.

Mr. Millett: Perhaps.

Mr. Millett: Industrial type valuation.

Speaker Change: Dividend, increasing profile simply because as we start to see again, the fruition and Mark mentioned in his opening comments.

Mr. Millett: You just look at our total shareholder return over the years.

Mr. Millett: I mean, you can argue against it.

David: And the last three years, but our last five years spent money for organic growth now we're going to start seeing the benefit from a cash stream perspective, and an earnings stream perspective in 2025 and that will be a great.

Mr. Millett: Whether it's a one year or three year five year 10 year.

Mr. Millett:

Mr. Millett: I think the team has done an incredible job.

Mr. Millett: Following through on what we've always said and Thats.

David: Our resource for us to continue to again as I mentioned buyback company that we think is pretty well run at a pretty significant discount. So we don't see anything like that we don't see anything changing from this point forward.

Mr. Millett: Our long term.

Mr. Millett: Value, we don't look at just building a company for the next six months.

Mr. Millett: But when you have a 10 year total shareholder return of 813%.

Mr. Millett: Which is.

Mr. Millett: Three almost four times are our best steel here.

Speaker Change: Thank you that concludes our question and answer session I would like to turn the call back over to Mr. Millett for any closing remarks.

Mr. Millett: Even though the S&P 500 index of 255% I mean, we blow those statistics away and it's because of the.

David: Well again, thank you everyone for joining us and I guess.

Mr. Millett: The business model. The team has built over the over the last 15 or 20 years.

David: As I reflect on what we on these calls tend to get driven into.

Mr. Millett: Essentially that the foundation of that.

David: Sort of detail near term detail.

Mr. Millett: The company.

Mr. Millett: And so.

David: But just to acknowledge those that.

Mr. Millett: I would just think those that recognize that.

David: Our shareholders and those analysis.

Mr. Millett: And continue to support Us and then finally.

David: The.

David: Literally started looking at us as a bench.

Mr. Millett: Again to every single.

David: Metals business.

Mr. Millett: And employee team laid out thank you for what you do you are incredible.

Speaker Change: More of a.

David: Perhaps.

David: <unk> type valuations.

Mr. Millett: Thank you.

David: Just look at the.

David: Total shareholder return over the years.

Mr. Millett: Once again, ladies and gentlemen that concludes today's call. Thank you for your participation and have a great and safe day.

David: You can argue against that.

David: The whether it's a one year or three year five year 10 year.

David: I think the team has done an incredible job.

David: Following through on what we've always said and that's a long term.

David: The value we don't look at building the company for the next six months.

David: So when you have a 10 year total shareholder return.

David: 813%.

David: Which is.

David: Three almost four times are our best still here.

David: Even though the S&P 500 index of 255% I mean, we blow those.

David: And it's because of the of the business model. The team has built over the overlap between the <unk>.

Essentially the foundation.

David: The company.

David: And so.

David: I'd just thank those that recognize that.

David: And continue to support Us and then finally.

So every single.

And employee team laid out thank you for what you do you are incredible.

Lisa: Lisa Thank you.

David: Once again, ladies and gentlemen that concludes today's call. Thank you for your participation and have a great and safe day.

Q4 2024 Steel Dynamics Inc Earnings Call

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