Q2 2025 Ryerson Holding Corp Earnings Call
If you would like to ask a question. Please press star one on your telephone keypad at any time again that is star one to ask a question at this time I would like to turn the conference over to Justine Carlson. Please go ahead.
Good morning, Thank you for joining Ryerson holding Corporation second quarter 2025 earnings call on our call. We have Eddie later, right, President and Chief Executive Officer, and Kaufmann, Our Chief Financial Officer, and Molly Cannon, our Chief Accounting officer and corporate controller.
Bartlett, our senior Vice President of supply chain, and Jorge Perez vein, our vice President of finance will be joining us for Q&A.
A recording of this call will be posted on our Investor Relations website at IR Dot Ryerson Dot com. Please read the forward looking statement disclosures included in our earnings release issued yesterday and note that it applies to all statements made during this call in.
In addition, our remarks today refer to several non-GAAP measures.
Reconciliations of these adjusted numbers are also included in our earnings release.
I'll now turn the call over to Eddie.
Thank you Justine.
Good morning, and thank you all for joining us to discuss our second quarter 2025 performance.
As we continue winding through.
Protracted industry downturn.
With PMI prints showing contraction in 30 of the past 32 months.
Bandwidth carbon and stainless commodity bellwethers.
<unk> to grind lower through the second quarter.
Self help is the name of the game as we continue building operating leverage for the next cyclical upturn.
As necessary trade policy resets, along with relatively high interest rates.
Stagflation fears.
Global Overcapacity management challenges and tariff uncertainty impede short term manufacturing and.
Industrial metals activity.
There is optimism with looking towards the medium.
Longer term.
Demand trends that have been suppressed through this unique and.
An extended downturn.
Ryerson continues operationalized, it's capex.
Systems and acquisition investments.
Where we have deployed more than $650 million in capital.
Since 2021.
Modernize our network of intelligently connected service centers.
As these investments becomes fully operational.
And the network stabilizes around greater consistency.
At scale pertaining to lead times service levels on time delivery and value added processing.
We expect to continue to see improvements in our performance.
And the experience we offer to our customers.
While we continue to complete projects and improved quote signal to noise on quote ratio throughout our network whereby investment related disruptions give weighted network and service center consistency and stability, we are positioning <unk> well for the next cyclical upturn.
During the second quarter, we saw customer activity, turning increasingly cautious, particularly within our OEM contract book of business, while self help driven transactional business.
Hold the plough with market share gains realized even amidst ongoing bellwether price declines in carbon and stainless steel commodity indexes.
It is still a price market as competitive intensity for orders amongst service centers is high and customers in general are bind minimum requirements quoting.
Quoted less.
That said as we are early in the third quarter, we are seeing price trends stabilize, albeit a bit slowing and below trend demand. We're in the dog days of this extended downturn playbook calls for execution around continuing to take out non value added costs.
Yeah.
Precise working capital management and hustling for every order and proving out our investments and renovated operating model at this point I'll turn it over to Jim Claussen to discuss market conditions and our financial results.
Thanks, Debbie and good morning, everyone.
Given the market dynamics that we discussed.
North America industry volumes as measured by the MSCI, Our metals Service Center Institute.
Performed well below normal seasonal levels in the second quarter decreasing by two 1% relative to the first quarter.
By comparison, our north American shipments decreased by one 2% quarter over quarter generating incremental market share gains with particular strength in carbon long carbon plate and stainless loan products compared to the industry.
Total company tons shipped were up fractionally quarter over quarter with relative strength among customers in our consumer durable sector, particularly in appliances and recreational vehicles and also amongst some of our customers and the hvac's sector.
On the other hand, we saw quarterly sequential volume contraction and our construction equipment sector.
We noted sub sector industry bright spots and data center and public infrastructure projects driven by federal investment spending.
And finally, we saw relative quarter over quarter weakness in our commercial ground transportation sector as the industry appeared to align build rates with a cautious replacement cycle environment illustrated by the order data published by ACP research.
Given that market backdrop, let's transition to our second quarter performance compared to guidance and our third quarter 2025 outlook.
During the second quarter, we achieved adjusted EBITDA, excluding LIFO at the high end of our guidance range with revenue and shipments within our range.
Similarly in appliances, and recreational vehicles and also amongst some of our customers and the hvac's sector.
On the other hand, we saw quarterly sequential volume contraction and our construction equipment sector.
Late in the quarter, we saw supply side increases in all three of our primary product lines, increasing our second half pricing and cost expectations.
We noted sub sector industry bright spots and data center and public infrastructure projects driven by federal investment spending.
This rise unexpected metal costs led to a higher LIFO charge for the second quarter as our full year estimate for LIFO grew to approximately a $40 million expense.
And finally, we saw relative quarter over quarter weakness in our commercial ground transportation sector as the industry appeared to align build rates with a cautious replacement cycle environment illustrated by the order data published by ACG research.
This LIFO ketchup drove net income to the low end of our range.
We note that given our inventory levels and the nature of many of our contracts we require more than one quarter of duration to see price changes realized in the market.
Given that market backdrop, let's transition to our second quarter performance compared to guidance and our third quarter 2025.
Eddie Lehner: Customers in our consumer durable sector, particularly in appliances and recreational vehicles, and also among some of our customers in the HVAC sector. On the other hand, we saw quarterly sequential volume contraction in our construction equipment sector. We noticed subsector industry bright spots in data center and public infrastructure projects driven by federal investment spending. Finally, we saw relative quarter-over-quarter weakness in our commercial ground transportation sector as the industry appeared to align build rates with a cautious replacement cycle environment, illustrated by the order data published by ACT Research. Given that market backdrop, let's transition to our second quarter performance compared to guidance and our third quarter 2025. During the second quarter, we achieved adjusted EBITDA exceeding the high end of our guidance range, with revenue and ship weight in the quarter. We saw supply side in the quarter.
We also recognize but given some fluidity in trade and tariff policy. Some of the increases may be short lived.
The second quarter, we achieved adjusted EBITDA, excluding LIFO at the high end of our guidance range with revenue and shipments within our range.
During the second quarter, we achieved adjusted.
Paul.
Looking ahead to the third quarter of 2025, we expect volumes to soften during the quarter by 2% to 4% as we anticipate that the demand environment will remain challenged by continued uncertainty across many of our large end markets as well as normal seasonality patterns.
Okay.
The revenue and shipments.
Late in the quarter, we saw supply side increases in all three of our primary product lines, increasing our second half pricing and cost expectations.
In the quarter, we saw.
<unk>.
And all three primary product.
Increasing.
Pricing and cost.
This rise in expected metal costs led to a higher LIFO charge for the second quarter as our full year estimate for LIFO grew to approximately a $40 million expense.
Yeah.
This right now.
A higher LIFO.
However, we do anticipate that the pricing environment will remain supportive.
Okay.
LIFO.
Leading to average selling price appreciation of 1% to 3% and revenues in the range of 114 to $1, one 8 billion.
Approximately a $40 million.
This LIFO catch up drove net income to the low end of our range.
This LIFO.
Drove net income to the low end.
We know that given our inventory levels and the nature of many of our contracts we require more than one quarter of duration to see price changes realized in the market.
We know.
Inventory levels in the nation.
We expect that gross margins will benefit from modest price resets in our contract business.
Sure.
As required.
Okay.
Price changes.
We also recognize that given some fluidity in trade and tariff policy. Some of these increases may be short lived.
Given our recessed demand outlook, we expect flatter pricing expectations and margin pressure in our spot business.
We also recognized given liberty.
Our policy.
All of these increases.
Looking ahead to the third quarter of 2025, we expect volumes to soften during the quarter by 2% to 4% as we anticipate that the demand environment will remain challenged by continued uncertainty across many of our large end markets as well as normal seasonality patterns.
In all we forecast third quarter adjusted EBITDA, excluding LIFO in the range of $40 million to $45 million and earnings per share in the range of zero to six cents per diluted share.
Looking ahead to the third quarter.
Okay.
We expect volumes during the quarter.
Eddie Lehner: We saw all three primary product lines, all three increasing about half pricing and half pricing. This rise in expected metal costs did drive a higher LIFO charge for the second quarter. The higher LIFO, our full-year estimate for LIFO, and approximately a $40 million. This LIFO catch-up drove net income to the lowest. We know that given our inventory levels and the nature of many of our contractors, we require more than one quarter of duration to acquire price change realized in the market. Price change. We also recognize that given some fluidity, we also try to tackle some of these increases may be short-lived. Looking ahead to the third quarter of 2024, we expect volume to fall during the quarter. We expect volume to fall 4% during the quarter.
As we anticipated and environment.
<unk> challenged.
Yes.
Cause many.
We expect LIFO expense to be between nine and $11 million in the quarter.
Sure.
As well as normal seasonal pattern.
However, we do anticipate that the pricing environment will remain supportive.
However, we do anticipate.
Turning to our investments in the business in the second quarter, our capital expenditures totaled $10 million and included investments in processing capabilities and maintenance projects.
Pricing environment will remain.
Leading to average selling price appreciation of 1% to 3% and revenues in the range of 114 to one $1 8 billion.
Average selling price appreciation.
One 3%.
Revenue in the range of.
Year to date, we have made $18 million in Capex investments and remain on track with our stated $50 million full year target, which follows a record three year investment cycle and focuses on operational rising final components of those investments, while returning to a more normalized level of investment.
118.
We expect that gross margins will benefit from modest price resets in our contract business.
Yes.
We expect gross margin.
From modest price resets.
Given our recess demand outlook, we expect flatter pricing expectations and margin pressure in our spot business.
Okay.
Given that.
The outlook, we expect flatter.
And margin pressure in our business.
In all we forecast third quarter adjusted EBITDA, excluding LIFO in the range of $40 million to $45 million and earnings per share in the range of zero to <unk> <unk> per diluted share.
In the second quarter, we generated $24 million in cash from operations as our receivables normalized relative to the first quarter, but were partially offset by a modest inventory build as overall inventory cost per ton increased in the quarter more than anticipated as previously noted.
In all we forecast first quarter EBIT.
EBITDA.
Eddie Lehner: We anticipate that the demand environment remains challenged by continued uncertainty across many of our large end markets, as well as normal seasonality patterns. However, we do anticipate that the pricing environment will remain supportive, increasing environment leading to increasing price appreciation, average 1.5%, and revenues in the range of $1.14 billion to $1.18 billion. We expect that gross margins will benefit. We expect from modest price reset in our contract, modest price reset given a recent demand outlook, given a flat pricing expectation and margin pressure in our spot business. We forecast third quarter EBITDA, just including LIFO, in the range of $40 million to $45 million and earnings per share in the range of zero to six cents. We expect LIFO expense to be between $9 million and $11 million. Turning to our investments in the business, in earning from our investments, our capital expenditures are $2 million.
Paul.
Turning to $40 million to $45 million.
Earnings per share in the range.
<unk>.
We expect LIFO expense to be between nine and $11 million in the quarter.
Yes.
We expect a slight pause.
Between nine and $11 million.
Turning to our investments in the business in the second quarter, our capital expenditures totaled $10 million and included investments in processing capabilities and maintenance projects.
Overall, although working capital was higher nominally than anticipated, we effectively managed our working capital during the second quarter, achieving a cash conversion cycle of 66 days, which is slightly lower than the first quarter and 11 days lower than the year ago period.
Turning to the business.
Total capital expenditures.
Is it investment.
Pricing capabilities.
Year to date, we have made $18 million in Capex investments and remain on track with our stated $50 million full year target, which follows a record three year investment cycle and focuses on operational <unk> final components of those investments, while returning to a more normalized level of investment.
Okay.
Year to date, we have made $18 million.
Okay.
Okay.
We ended the second quarter with $510 million of total debt and $479 million of net debt, which represents a modest increase compared to $498 million and $464 million respectively for the prior quarter.
$850 million full year.
Following a record year.
Sure.
Operationalized filings.
We're returning to a more normalized level.
In the second quarter, we generated $24 million in cash from operations as our receivables normalized relative to the first quarter, but were partially offset by a modest inventory build as overall inventory cost per ton increased in the quarter.
This quarter, we generated.
Okay.
Our counter cyclical trailing 12 month adjusted EBITDA, excluding LIFO generation.
Absolutely expirations.
Normalized.
This quarter.
Coupled with the sequential net increase of $15 million.
Partially offset by a margin.
Overall inventory cost per ton.
More than anticipated as previously noted.
<unk> in our second quarter leverage ratio of four four times, which remains above our target range of 5% to two times.
More than anticipated previously.
Overall, although working capital was higher nominally than anticipated, we effectively managed our working capital during the second quarter, achieving a cash conversion cycle of 66 days, which is slightly lower than the first quarter and 11 days lower than the year ago period.
Overall, although working capital was higher.
Eddie Lehner: Capital expenditures included investment processing capabilities and maintenance processing capabilities. Year to date, we have made $18 million in capital expenses. Remaining on track with our stated $50 million full-year target. Recurring three-year investment cycle, our focus is on operationalizing final components of those investments, while returning to a more normalized level. In the second quarter, we generated $24 million in cash from operations as our receivables normalized relative to the fruitful normalized. But we're partially offset where I have modest inventory costs as overall inventory cost per ton increased to more than anticipated as previously noted. Overall, although working capital was higher, we effectively managed the total working capital, creating a cash conversion cycle of 60 days. Conversion today is slightly lower than the first quarter, which is 11 days lower than the year-ago period. We ended the second quarter with $510 million in net debt.
As we move into the back half of the year, we expect cash flow generation to move our leverage ratio back towards our target range.
Dissipated, we effectively managed our working capital.
Alright.
Using our cash conversion cycle.
It's just slightly.
From a global liquidity perspective, the company's profile remained healthy and we ended the second quarter at $485 million of liquidity compared to $490 million at the end of the first quarter.
First quarter <unk>.
Seven days lower than the east.
We ended the second quarter with $510 million of total debt and $479 million of net debt.
We ended the second quarter to.
$110 million.
479 million.
Each represents a modest increase compared to $498 million and $464 million respectively for the prior quarter.
Which represents a model.
Turning to shareholder returns Ryerson distribute $6 million in the form of dividends during the second quarter.
Compared to 498.
164 million respectively.
Our counter cyclical trailing 12 month adjusted EBITDA, excluding LIFO generation, coupled with the sequential net increase of $15 million.
We paid a quarterly dividend of <unk> 18, and three quarter cents per share and announced a third quarter 2025 cash dividend of the same amount.
Alright.
Okay.
Trailing 12 months.
EBITDA excuse me.
With this.
We did not repurchase any shares in the second quarter and ended the period with $38 $4 million remaining on our share repurchase authorization.
That increase.
<unk> in our second quarter leverage ratio of four four times, which remains above our target range of two five to two times.
No.
As noted in our second quarter leverage ratio.
Hi.
Which remains.
Target range of <unk> five.
As we look forward to the third quarter and into the rest of 2025, we will continue to prudently evaluate our overall capital allocation and tightly manage our expenses and working capital.
As we move into the back half of the year, we expect cash flow generation to move our leverage ratio back towards our target range.
As we move into the back half.
We expect.
Great.
Our leverage ratio back towards our.
From a global liquidity perspective, the company's profile remained healthy and we ended the second quarter at $485 million of liquidity compared to $490 million at the end of the first quarter.
I'll now turn the call over to Molly Canada to discuss our financial performance highlights for the second quarter.
From a global liquidity.
If you can help.
Eddie Lehner: We ended the second quarter with $579 million of net debt, which represents $498 million compared to $494 million, respectively. Our countercyclical trailing 12-month EBITDA, coupled with this sequential net debt increase of $15 million, resulted in a second quarter leverage ratio of 0.5, which remains above our target range of 0.5. As we move into the back half of the year, we expect our leverage ratio back towards from a global liquidity perspective. We remain healthy and ended the second quarter at $485 million of liquidity. $480 million to $490 million compared to the $490 million at the end of the quarter. Turning to shareholder returns, Ryerson has returned shareholder returns in the form of dividends. We expect million dollars in the form of dividends. We did a quarterly dividend of 18.3%. Quarterly dividend. We have announced the third quarter 2025 cash dividend. Third quarter same amount.
Yeah.
This quarter at $485.
Thanks, Jim and good morning, everyone.
And the second quarter of 2025, Ryerson reported net sales of $1. One 7 billion, an increase of 3% compared to the first quarter with average selling price was up two 8% and tons shipped up fractionally.
Compared to $490 million at the end of the first.
Turning to shareholder returns Ryerson distributed $6 million in the form of dividends during the second quarter we.
Shareholder return.
Right.
$6 million in the form of dividend.
We paid a quarterly dividend of <unk> 18, and three quarter cents per share and announced a third quarter 2025 cash dividend of the same amount.
Okay.
AP.
Average selling price growth quarter over quarter was driven by increases in aluminum and carbon products.
Now for the third quarter.
Cash dividend.
We did not repurchase any shares in the second quarter and ended the period with $38 $4 million remaining on our share repurchase authorization.
Hi.
We did not repurchase.
Up six 8% and two 1% respectively.
Okay.
Okay.
$4 million.
Gross margin during the quarter contracted by 10 basis points versus the prior quarter to 17, 9% influenced by a higher than anticipated LIFO expense of $13 million as rising commodity prices in the period translated to material costs increasing faster.
Our share repurchase offer.
As we look forward to the third quarter and into the rest of 2025, we will continue to prudently evaluate our overall capital allocation and tightly manage our expenses and working capital.
As we look forward to our third quarter.
Okay.
We will continue to evaluate our overall.
Page.
Tightly manage our <unk>.
I'll now turn the call over to Molly Canada to discuss our financial performance highlights for the second quarter.
I'll now turn the call over them.
The financial performance highlights for the second quarter.
Thanks, Jim and good morning, everyone.
Then average selling prices given the lag nature of pricing recognized in our contractual business.
Thanks, Jim.
In the second quarter of 2025, Ryerson reported net sales.
Yes.
Yes.
Excluding LIFO gross margin expanded sequentially by 40 basis points to 19%.
<unk>, one 7 billion, an increase of 3% compared to the first quarter with average selling prices up two 8% and tons shipped up fractionally.
Yes.
Seven.
3%.
On the expense side second quarter, warehousing delivery, selling general and administrative expenses increased to $204 million or by $1 $5 million compared to the first quarter as a result of one additional business day.
Okay.
Average selling prices.
Okay.
Tons shipped.
Average selling price growth quarter over quarter was driven by increases in aluminum and carbon products.
And the selling price growth quarter over quarter.
Eddie Lehner: 2025 cash dividend. We did not repurchase any shares in the second quarter. We did not repurchase. We ended the period with $38.4 million remaining on our share repurchase acquisition. As we look forward to the third quarter and into the rest of 2024, we continue to rapidly evaluate our overall capital allocation. We evaluate tightly managed our expenses and working capital. I will now turn the call over to Molly Kannan to highlight the second quarter financial performance highlights for the second quarter.
Okay.
Up six 8% and two 1% respectively.
All right.
Hi.
Okay.
And two 1% respectively.
Expenses decreased sequentially, both on a percentage of revenue and on a per day basis illustrating our continued commitment to it.
Gross margin during the quarter contracted by 10 basis points versus the prior quarter to 17, 9% influenced by a higher than anticipated LIFO expense of $13 million as rising commodity prices in the period translated to material costs increasing faster.
Gross margin during the quarter in China.
Basis points.
Hi.
Okay.
<unk> management.
And IRA.
Second quarter net income attributable to Ryerson was $1 9 million or <unk> <unk> per diluted share compared to net loss attributable to ryerson of $5 6 million and diluted loss per share of 18 cents in the prior quarter.
Yes.
Tom.
Alright, Thanks, a lot.
Tran.
Then average selling prices given the lag nature of pricing recognized in our contractual business.
Molly Kannan: Thanks, Jim. Good morning, everyone. Thanks, Jim. In the second quarter of 2025, Ryerson reported net sales of $1.17 billion, an increase of 7% compared to the first quarter, with average selling prices up 2.8%. Average selling prices zipped up fractionally. Average selling price growth quarter over quarter was driven by increased growth in aluminum and carbon products, with 6.1% and 2.1% respectively. Gross margin during the quarter contracted by 10% from the prior quarter to 17.9%. This was influenced by a higher than anticipated LIFO expense of $10 million and rising commodity prices in the period. Rising translated to material costs and rising faster than average selling prices. Given the lag nature of pricing recognized and excluding LIFO, gross margin expanded successfully by 40 basis points to 19%.
Faster.
Even though annual tariff pricing recognized in our construction.
Excluding LIFO gross margin expanded sequentially by 40 basis points to 19%.
In summary, our adjusted EBITDA, excluding LIFO achievement of $45 million in the second quarter of 2025 compared favorably to generation of $32 8 million in the prior quarter.
Okay.
And at <unk>.
40 basis points to 19.
On the expense side second quarter, warehousing delivery, selling general and administrative expenses increased to $204 million or by $1.5 million compared to the first quarter as a result of one additional business day.
I think quarter.
Great.
General and administrative.
And with this I will turn the call back to Eddie.
Okay.
Good morning.
Thank you Molly.
Sure.
I would like to conclude our prepared comments.
Alright.
Sure.
One additional point.
<unk> the Ryerson team for working safely.
Expenses decreased sequentially, both on a percentage of revenue and on a per day basis illustrating our continued commitment to it.
Okay.
And productively during the second quarter as we remained focused on what we can control.
Actually both.
Correct.
What are they.
Illustrate Inc.
<unk> management.
Commitment.
Integrating our new advanced capabilities into our interconnected network.
Second quarter net income attributable to Ryerson was $1 9 million or <unk> <unk> per diluted share compared to net loss attributable to ryerson of $5 6 million and diluted loss per share of <unk> 18 in the prior quarter.
<unk> management.
Okay.
Yes.
Right.
About our customers with a higher level of customer experience.
Or six.
Sure.
Net loss attributable to worsen.
We're also managing the business well.
No.
Through the current business environment.
Yes.
18.
In summary, our adjusted EBITDA, excluding LIFO achievement of $45 million in the second quarter of 2025 compared favorably to generation of $32 8 million in the prior quarter.
As challenging as current and near term conditions may be we.
Yeah.
Yes.
Jesse.
We are proving our resiliency and expanding.
Oh excuse me.
$5 million.
Molly Kannan: On the expense side, second quarter warehousing delivery selling share increased to $204 million, or by $1.4 million compared to the first quarter, as a result of one additional business day. Expenses decreased sequentially both on a percentage of revenue and on a per day basis, illustrating our commitment to expense management. Second quarter net income attributable to Ryerson was $4.9 million, equal to $0.06 per diluted share, compared to a net loss attributable to Ryerson of $65.6 million and diluted loss per share of $0.18 in the prior quarter. In summary, our adjusted EBITDA excluding LIFO, our achievement of $45 million in the second quarter, compared favorably to generation of $38 million in the prior quarter. With this, I will turn the call back to Eddie.
In the second.
Our earnings quality through the cycle.
Yes.
Generation.
As we look forward to a revitalized.
$8 million.
And with this I will turn the call back to Eddie.
Okay.
Manufacturing economy.
And with this I'll turn the call back to Ed.
Thank you Molly.
<unk> of which are already materializing in the form of negotiated trade deals.
I would like to conclude our prepared comments.
Thank you Mollie.
I would like to conclude.
<unk> the Ryerson team for working safely.
Amen.
And emergent reassuring data points.
<unk> highest achieved safely.
And productively during the second quarter as we remained focused on what we can control.
As I mentioned, China prior to call and backed by popular demand from the movie to CRO.
It's Scott.
During the quarter.
We remain focused on.
Integrating our new advanced capabilities into our interconnected network.
It can't rain all the time.
Hey, Brittany.
And we're just looking forward to a period.
Are you.
Thanks, Joe.
Of some extended Sunshine.
Sure.
About our customers with a higher level of customer experience.
With that.
Yes.
And after the Q&A, we would like to share a video on the upgrades at our Shelby adult facility.
And our customer.
Higher level.
We're also managing the business well.
Sure.
We will also manage.
Through the current business environment is.
Well.
For those of you dialed into video is also available.
Through the current.
As challenging as current and near term conditions, maybe we.
Ireland.
On our investors relations website operator, please open the line for questions.
Alex.
Current and near term.
We are proving our resiliency and expanding.
It should be.
We are proving.
Our earnings quality through the cycle.
Nancy.
Anthony.
Yeah. Thank you if you are dialed in via the telephone and would like to ask a question. Please signal by pressing star one on your telephone keypad. If you are using a speaker phone. Please make sure. Your mute function is turned off to allow your signal to reach our equipment.
Our earnings.
As we look forward to a revitalized.
Michael.
We look forward.
Manufacturing economy.
U S manufacturing economy.
<unk> of which are already materializing in the form of negotiated trade deals and emergent re shoring data points.
Eddie Lehner: I would like to conclude our prepared call. I would like to conclude by making on Ryerson teams who have safely, productively, safely during the second quarter as we remain focused on what we have to do. We remain focused in creating our due, expanding our due into our interconnected network, ensure our customers at a higher level, ensure our customers at a higher level while also managing the business well, while also managing the current business well environment through the current challenging our current and near-term challenges. We need to be improving our resiliency, we are improving our resiliency and our earnings quarterly. In the cycle of our earnings, as we look forward, to a revitalized, we look forward, U.S. manufacturing autonomy. U.S. manufacturing autonomy. We have already materialized in the form of already materialized data trade deal on an emergent trade assuring data point.
Alright.
Already material.
Okay.
Trade deal.
Merchant reached.
Jim Press Star one to ask a question. If you are in the event via the web interface and would like to ask a question simply type your question into the ask a question box and click send.
As I mentioned, China prior to call and backed by popular demand from the movie to CRO.
As Matt mentioned.
Okay.
And backed by popular demand.
It can't rain all the time.
No.
We're just looking forward to a period.
Yes.
We're just looking forward.
Some extended Sunshine.
Our first question is going to come from Samuel Mckinney Keybanc capital markets. Please go ahead.
With that.
Sunshine.
And after the Q&A, we would like to share a video.
Yes, Pat.
Yes.
On the upgrades at our Shelby to open facility for those of you dialing into video is also available.
We would share a video.
Okay.
Hi, good morning, Eddie and team.
And our.
Hey, Sam How're you doing.
Okay.
Those of you dialing in to begin with.
On our investors relations website operator, please open the line for questions.
Good take the presentation called out North American market share growth in carbon longs in plate in the release noted another quarter of increasing transactional business.
Okay.
On an hour.
Duration left.
Operator, please open the line for questions.
Yes. Thank you if you are dialed in via the telephone and would like to ask a question. Please signal by pressing star one on your telephone keypad. If you are using a speaker phone. Please make sure. Your mute function is turned off to allow your signal reach our equipment.
I wanted to give you the opportunity to talk more about some of the biggest wins for this demand as more of your capex projects have become full contributors.
Hello.
Yeah.
Hi, Chris.
That's helpful Scott.
Yes, Sam I mean at the risk of going deep under the Hood of a car.
No problem.
Eddie Lehner: An emergent, as I mentioned, during the prior call, as I mentioned, impacted by popular demand from the moon to the cross. Popular demand can't rain all the time. We're just looking for a period of time. With that, and after the Q&A, we would like to share a video on the upgrade. Share a video on our Shelbyville about the upgrade. Those of you dialed in, the video is also available on our operator's relation website. Please open the line for questions.
Off to allow your.
Again press Star one to ask a question. If you are in the event via the web interface and we'd like to ask a question simply type your question into the ask a question box and click fit.
As you bring up these investments.
Right.
Again I'm sorry.
You find out that what happens is you disconnect things within your European environment. For example, so you take out all these work centers.
Okay.
Yes, I am.
Yes.
Type. Your question did you ask a question box and click.
You build the equipment cash goes out and then you install the equipment and you get through commissioning and startup curve all things that I know you're aware of it. It's the 50 things when you go back to set up things like material Masters and you set up.
Our first question is going to come from Samuel Mckinney Keybanc capital markets. Please go ahead.
Our first question is going to come.
Nick.
Great Capital Mark. Please go ahead.
Yes.
Hi, good morning, Eddie and team.
Hi, good morning, Eddie.
Hey, Sam How're you doing.
Bill of material rallies in the new setup shuttle rallies between processing centers.
Good day presentation called out North American market share growth in carbon longs in plate in the release noted another quarter of increasing transactional business. Just wanted to give you the opportunity to talk more about some of the biggest wins for this demand as more of your capex projects have become full contributors.
Hey.
<unk>.
Yes.
And service Center, and then its delivery and all that stuff needs to get connected up again, so over time.
I'll now North American market growth.
Okay.
Molly Kannan: Yeah, thank you. If you are dialed in via the telephone and would like to ask a question, please signal by pressing star one on your telephone keypad. If you are using your speakerphone, please make sure your mute function is turned on to allow your signal to reach our equipment. Again, press star one to ask a question. If you are in the event via the web interface and would like to ask a question, please type your question into the ask a question box and click send. The first question is going to come from Samuel McKinney. Please go ahead.
Another quarter of increased.
You have a better service model like you keep refining it refine it take out frictional cost in your network, which is really a big part of this in the Capex cycle being extended to the extent that it has been we start to see improvements in lead times and service levels in terms of where inventory is placed getting to the customer faster.
When do you see opportunity and we'll talk more about.
And what's the Capex projects have become full contributors.
Yes, Sam I mean at the risk of going deep under the Hood of a car.
Yes.
At risk.
Deep.
As you bring up these investments.
Alright.
As you bring up.
You find out that what happens is you disconnect things within your European environment. For example, so you take out all these work centers.
And really consistency be more consistent.
Yeah.
Disconnect.
On every quarter and some of the tools, we built on the system side, the ERP conversion very difficult, but once you start to move further and further away from that some of the tools that we've developed quote faster.
For example, so you take that.
You build the equipment cash goes out and then you install the equipment and you get through a commissioning and startup curve all things that I know you're aware of it. It's the 50 things when you go back to set up things like material Masters and you set up.
You build with <unk>.
Al.
Oh.
Got it.
All things.
Sure.
Convert faster those things start to take center stage and start to become more prominent so.
Samuel Mckinney: Hi, good morning, Eddie and team. Hi, good morning, Eddie.
You go back to things like materials.
Eddie Lehner: Hey, Sam. How are you doing? How are you doing?
Bill of material routing. So then you setup shuttle rallies between processing centers.
But you can go out and provide a better customer experience it's a process.
Building materials.
Samuel Mckinney: The presentation calls out North American market share growth. Please note as another quarter increasing transactional growth, I just wanted to give you the opportunity to talk more about some of the biggest wins for this demand where more of your CapEx projects have become full contributors.
Its between us.
And service Center, and then its delivery and all that stuff needs to get connected up again, so over time.
But over time, we continue to improve and those are the things that we can fundamentally control.
Sure.
All that to get to.
You have a better service model like you keep refining it refinery if you take out frictional costs in your network, which is really a big part of this in the Capex cycle being extended.
Thanks.
Time.
Perfect.
Okay. Thank you.
Thank you.
And then next one for me the second quarter EPS enjoyed a tax benefit of over a quarter of share just talk about the mechanics, there and if we should expect a similar tailwind during the third quarter in which you expect EPS to be relatively flat sequentially.
Our.
Network.
It's hard.
Eddie Lehner: Yes, Sam. At the risk of going deep under the push for going deep, as you bring up these investments, as you throw out the outfit, what happens is you disconnect things within your European environment. Disconnect so you can take on your EC centers, for example. You build the equipment, cash goes out, and you build the equipment, cash goes out. You get through connection and it starts over. All things that I know you are aware of, it is all things that hit these things. When you go back and set up things like material mapping or you go back up things like material routing, things outside of shuttle routing, processing centers, all routing, and positive centers. Then it is delivered. All that other stuff needs to get disconnected and all that time needs to get. You have a better service of all time, but you keep providing.
Capex ended.
To the extent that it has been we start to see improvements in lead times service levels in terms of where inventory is placed getting to the customer faster and really consistently be more consistent.
To the extent that it has you start to see improvements in service.
Service levels.
Squeeze based.
Yes, I'm going to kick that over to Jim Claussen, our partner over there yes.
Customer faster and really consistent.
On every quarter and some of the tools, we built on the system side, the ERP conversion very difficult, but once you start to move further and further away from that some of the tools that we've developed quote faster to convert faster those things start to take center stage and start to become more prominent so.
Sure.
On the quarter and some of them.
Good morning, Sam.
Really what we what we saw in the second quarter.
Very good.
<unk>.
Once you start to move further in two waves.
With obviously reduced earnings a lower tax provision so thats in line, but we also did get some discrete.
<unk> grew.
The faster.
For those.
Those things start to take center stage.
But you can go out and provide that better customer experience, it's a process but.
<unk> tax credits.
Amit.
In the quarter.
But you can go out.
Your customer experience.
Occasionally there is discreet tax items that come through on either a state or federal level. So what.
But over time, we continue to improve and those are the things that we can fundamentally control.
Yes.
But over time, we continue to improve regardless things that we can fundamentally control.
What I would expect going forward is.
Eddie Lehner: You have a better service that you take out every time you are in your network. Take out. It is really a big part of this network. The CapEx is part of being extended. CapEx is extended. It has been. Then start to see improvements. Then you have service levels in terms of where auditory is placed. Service level getting to the customer faster. Really insisting on every. Really insisting on every. Some of the tools on every system order. Some of the conversion is very difficult. Once it is very. Start to move further and further. Once from that, some of the parts move further along the way better and it starts to convert faster. Those things start to take center stage or start to go from things that take center stage.
No.
Okay. Thank you.
Basic effective tax rate around 20% 20, 25% to 26%.
And then next one for me the second quarter EPS enjoyed a tax benefit of over a quarter of share just talk about the mechanics, there and if we should expect a similar tailwind during the third quarter in which you expect EPS to be relatively flat sequentially.
Okay. Thank you.
Yes.
Between state and federal.
<unk>.
Yes.
Good morning.
Okay.
Great.
Good morning.
Okay. Thank you for taking my questions.
And we went through in the third quarter.
Thanks Sam.
Yes to be relatively flat.
Yes, I'm going to kick that over to Jim Claussen, our partner over here.
And our next question is going to come from Jimmy <unk> from BMO capital markets.
I'm going to kick that over there.
Yes.
Sure.
Good morning, Sam.
Okay.
Yes.
Really what we what we saw in the second quarter.
Hi, Thank you for taking my question.
Great.
Really what we.
Maybe going back to the transactional sales can you update us what the split currently is between transactional and contractual sales.
Yes.
On the second quarter.
With obviously reduced earnings a lower tax provision so thats in line, but we also did get some discrete.
Yeah.
With.
Lower back.
Matt.
But.
Eddie Lehner: That you can go out and provide that better cut or that you can go out to provide that better cut time. Over time, all of that seems to improve. Over time, we can continue to control the note card of things that we can fundamentally control.
Sure.
<unk> tax credits.
Right.
In the quarter.
Great.
On a.
Yeah.
Occasionally there is discreet tax items that come through either a state or federal level. So what.
This quarter.
On a ship and book basis, we're up to about 46% transactional about 54% program.
Okay.
Thanks.
What I would expect going forward is.
I mean.
Okay.
What I would expect and forward.
No.
And how are you thinking about the split moving forward.
Basic effective tax rate around 20% 20, 25% to 26%.
Samuel Mckinney: Okay, thank you. Next one from the second quarter. Yes. Point for me where the tax benefit of a fourth quarter share flat. Talk about the mechanics there and if we should expect a similar tailwind during the current quarter in which you expect the tailwind to be relatively flat sequentially. Yes, to be relatively flat.
No.
Basic.
Great.
Between state and federal.
Yes.
Thanks.
Yes.
The way, we think about the split is continue to.
Between state and federal.
Okay.
Perform well enough consistently so we get that we get more and more of that spot gold material business.
Okay. Thank you for taking my questions.
Okay.
Okay. Thank you for taking my question.
Thanks, Thanks Sam.
In the market. So it's really how you compete day to day out and it really goes back to the.
And our next question is going to come from Jimmy <unk> from BMO capital markets.
Thanks, Ed.
Eddie Lehner: am going to kick that over to Jim Claussen.
And our next question is go ahead.
Jim Claussen: Yeah, good morning, Samuel McKinney. Really what we saw in the second quarter, really what we saw in the second, with obviously reduced earnings, but out of a lower tax provision. We also did get some discrete lines of state tax credit in the quarter. Occasionally there are discrete tax items that come from, occasionally there is a state final. What I would expect going forward is what I would expect for basic effective tax rate around 20% to 25% to 26% between state and federal, between state and federal.
Yes.
Fundamentals of having inventory placed closer to the customer having processing lead times that are short quoting lead times are short and then when customers call anytime there's a jump ball.
From BMO capital markets.
Hi, Thank you for taking my question.
Hi, Thanks.
Maybe going back to the transactional sales can you update us what the split currently is between transactional and contractual sales.
Hi.
Maybe going back.
Actual kidney.
What's the split.
The ties and not just winning the ties, but it's just a more consistent experience.
Transactional and contractual sales.
Sure.
Sure.
On a.
Being able to quote fast locate the material processed material.
On a shifted book basis, we're up to about 46% transactional about 54% program.
Hi.
I should put base.
Ship on time, we're consistently and you do tend to win more transactional business.
46% transactional.
You do that.
Percent program.
And how are you thinking about the split moving forward.
Noted disruptions will be coming out of 'twenty. One 'twenty two obviously very very strong years, and then really going through what I call. The great unwinding of those things.
And how are you think the split.
Yes.
Yes.
Going forward.
The way, we think about the split is continue to.
Yes.
Hi.
Do we think about the split has continued.
Perform well enough consistently so we get that we get more and more of that spot gold material business.
A lot of commodity bellwether disinflation or deflation. If you will demand has been falling and then we had this investment cycle really over a three to four year period, we disrupted ourselves and know that we come out of that disruption and we operationalize. These investments we can go to market in a much more consistent fashion I mean, even where we have new service centers in <unk>.
Samuel Mckinney: Thank you for taking my questions. Thank you for taking my questions.
Okay.
We get more and more of that market.
In the market. So it's really how you compete day to day out and it really goes back to the fundamentals of having inventory placed closer to the customer having processing lead times that are short quoting lead times are short and then when customers call anytime there's a jump ball we win the ties.
Molly Kannan: Thank you. Our next question is from BMO Capital Markets. Hi, thank you for taking my question. Hi, thank you. Going back to the transactional sales, can you go into what the split is currently between transactional and contractual sales?
Yeah.
Gary.
It's really hot.
And it really goes back.
Perhaps individually plate.
Customers, having processing lead times for sure.
Major new service centers, whether it's in the Pacific Northwest or University Park in Chicago, Chicago Land area customers still have to reacquaint themselves with Ryerson and we have to reacquaint them with Ryerson.
Sure.
Customers call I mean.
And not just winning the ties, but it's just a more consistent experience.
We can time, not just putting the product.
Eddie Lehner: Sure. On a shift in pay, we're up to about 56% transactional, about 40% transactional, about 54% program.
To quote fast locate the material processed material and ship on time, we're consistently and you do tend to win more transactional business. When you do that we've noted disruptions will be coming out at 21 and 'twenty. Two obviously very very strong years, and then really going through what I call. The great unwinding of those things.
More.
Great.
In those geographies and providing those consistent experiences where we do that we start to gain share and we start to gain more transactional opportunities as two of the more prominent examples.
With JD com.
Material ship on time.
You do tend to be more transactional business.
Molly Kannan: How are you thinking about the split moving forward?
Can you do that.
We've noted disruption.
I think Jim mentioned data centers is one of the area, where there is strong demand for steel how much of your exposure goes to that market.
Eddie Lehner: The way you think about the split is to be more well enough consistently so we get more and more of that spot building material. Get more and more of that spot market content. So it's really how you compete day in and day out. The fundamental really goes back to having inventory placed, both having customers inventory, having processing lead times that are short, quote having processing short. Then when customers hold tall and even the ties, not just winning the ties, even it's just working. It's not just querying on our own. Being able to quote fast, locate the material, being able to quote fast, locate the ship on time and working serially. You do ship volume time transactional business. You do pay when you do that. We've noted the disruptions. Coming out of, we've noted in 2022 roughly coming out of very strong years.
David <unk> here.
We're going through.
A lot of commodity bellwether disinflation or deflation. If you will demand has been falling and then we have this investment cycle really over a three to four year period, we disrupted ourselves and know that we come out of that disruption and we operationalize. These investments we can go to market in a much more consistent fashion I mean, even where we have new sir.
Okay.
One commodity bellwether.
Right.
Great.
Then we had to.
It's just some vertical cocky its really hard to get an exact fixed on that we know that it's a secular build out and we're certainly getting our share of those opportunities and booking to that to that opportunity, but it is a sub sector and we're responding in.
Great.
Matt.
Construction of the operation.
Jordan.
<unk> centers and major new service centers, whether it's in the Pacific Northwest or University Park, Chicago, Chicago Land area.
At.
Major.
In a more granular fashion what that impact is.
Terrific.
Sure.
Customers still have to Reacquaint.
Yes.
One one more if I may.
<unk> with Ryerson and we have to reacquaint them with Ryerson in those geographies and providing those consistent experiences where we do that we start to gain share and we start to gain more transactional opportunities as two of the more prominent examples.
Yeah.
Thanks, Scott Smith.
When looking at your Capex human paid $50 million for 25, but when I look at the first half of the year, it's trending below that.
Sure.
Hi.
Hi.
Where we do not discard.
That just the timing or is there opportunity for capex to come below that $50 million.
Sure I can start to gain.
Annual opportunity.
Two of the more prominent examples.
I think Jim mentioned data centers is one of the area, where there's strong demand for steel how much of your exposure goes to that market.
It's really a function of timing and even having said that I mean your time the payments to when you hit certain milestones of commissioning and startup.
Eddie Lehner: Then really going through a period of gray line winding and really going through a line of commodity bellwether, demonetization of commodity bellwether. Demand has been too much late. Then we had this investment plan really over. Then we had a period where we even disrupted ourselves. Now that we come out of that disruption or the operational out of these investments, we can go to market in a much more consistent fashion. We can go to market where we have new service centers and major new services. Whether it's in major Civic Northwest or University Park or Chicagoland area, customers still have to reacquaint customers with Ryerson. We need to reacquaint them with Ryerson in those geographies, eyeing those specific areas. Where we do that, we start to gauge where we do that. We start to gauge where transactional offers share and start to gauge where transactional offers.
Okay.
Matt.
<unk> Centre is one yes, there is.
Well, how much of your exposure goes to that market.
So we're.
We're going to stay with $50 million. It will certainly have a better picture of how we're going to finish up the year. When we see you again in three months.
It's it's just some vertical cocky its really hard to get an exact fixed on that we know that it's a <unk>.
Alright.
Hi.
We already get it.
Secular build out and we're certainly getting our share of those opportunities and booking to that to that opportunity, but it is a sub sector and we're responding.
Thank you.
No.
Thanks Katja.
Thank you.
Our share of this opportunity.
And once again, if you'd like to ask a question press star.
That opportunity, but it is.
One on your telephone keypad or type your question into the ask a question box. Our next question is going to come from Alan Weber from <unk> Company.
In a more granular fashion what that impact is.
On a more granular fashion what that impact is.
One one more if I may.
Good morning.
When looking at your Capex human paid $50 million for 25, but when I look at the first half of the year, it's trending below that is there.
Looking at your Capex.
Good morning, how are you.
The $50 million.
Hi, Alan how are you.
Okay.
When I look at the first half.
Good.
The year.
Can you talk about I don't know if its possible.
That just the timing or is there opportunity for capex to come below that $50 million.
Is that just timing.
Eddie Lehner: Two of the more prominent examples.
I think that you've made over the last few years.
For capex to come below that $50 million.
It's really a function of timing and even having said that I mean your time the payments to when you hit certain milestones of commissioning and startup.
Molly Kannan: I think Jim mentioned that data centers is one of the areas where there's how much of your exposure goes to that market?
You think about the benefits.
Correct.
Hi.
Of what you ultimately expected how far along are you really what inning are you in whatever you want to.
Yeah.
When you hit milestones.
So we're.
We're going to stay with $50 million. It will certainly have a better picture of how we're going to finish up the year. When we see you again in three months.
Oh.
Raise it.
Eddie Lehner: It is a subvertical. It is not hard to get exactly what its size. I know that it is hard to get it to secular build-out. I know we are certainly getting our share of this opportunity. We will keep that to that opportunity. But it is a subfactor in where we are at on it. But it is in a more granular fashion what that impact is. A more granular fashion what that impact is.
Okay.
Yes, I mean, it's.
Alan it's hard to run away from market conditions.
Republicans have been choppy year, what we see again in three months.
Thank you.
If you have higher volumes and I would say if you have more duration around now.
Thanks Katja.
Thanks.
And once again, if you'd like to ask a question press star.
Thanks Scott.
Now ill turn in pricing and demand.
One on your telephone keypad or type your question into the ask a question box. Our next question is going to come from Alan Weber from Nobody in company.
Yes.
The whole thing is going to is going to look better.
Correct.
Our next question Joanne.
That said, we focus on Shelby drilling we're going to play a video at the end of the end of the call Shelby, though right now is probably at about 67% of its volume ramp up and so would you really what were really looking for out of Shelby Bill, where we've made a significant investment in our stainless franchises to get that to 100% of the expected volumes.
Molly Kannan: One more, if I may. When looking at your CapEx, you maintained the $50 million. You had your CapEx when you maintained the $50 million. But when I look at the first half of the year, it's you're looking below the half of the year. Is that just the timing or is there opportunity for CapEx to become below that $50 million? Is there opportunity for CapEx to become below that $50 million?
A question.
Yes.
From Alan Weber from robot.
Good morning, how are you.
Hi, Alan how are you.
Good morning.
Good.
Alan for you.
And can you talk about I don't know if its possible the investments that you've made over the last few years.
Okay.
Sure.
Uh huh.
Eddie Lehner: is really a function of timing. Even having said that, you need time to pay when you hit certain milestones of doing this. When you hit certain milestones, we are going to stay with $50 million. We will certainly have a better picture of how we are going to finish out the year when we see again in three months. How we are going to finish out the year when we see again in three months.
That internal rate of return case and really start to.
Okay.
You think about the benefits.
Yes.
Zinc about.
Provide a better service and lower cost model out to the market because we are taking in heavier coils, which processes coils more efficiently at a lower cost and we can stand that material out both to our service centers and to our customers with a better overall value proposition I think the timeline the timeline of return just <unk>.
Of what you ultimately expected how far along are you really what inning are you at where if you wanted to.
Okay.
Hum.
Yes.
Raise it.
What you have left.
Do you want to.
Yes, I mean, it's.
Phrase it.
Alan it's hard to run away from market conditions.
Yes.
It's hard to run away.
If you have higher volumes in.
Molly Kannan: Thank you.
Okay.
Eddie Lehner: Thanks, Katia.
Half.
I would say if you have more duration around now.
Molly Kannan: Now, once again, if you would like to ask a question, press one on your telephone keypad, or if you are 102 to ask a question. Time for a question in our next question. The question is going to come from Alan Weber from Robotic Income. From Alan Weber.
I would say to you.
Given market conditions become a little bit extended thesis.
Now ill turn in pricing and demand.
I'm not sure and in pricing and demand.
The whole thing is going to is going to look better.
As intact as your previous investments up to full maturity. We operationalize. These things and then customers get used to that experience and we can also sell.
The whole thing.
That said, we focus on Shelby drilling we're going to play a video at the end of at the end of the call Shelby, though right now is probably at about 67% of its volume ramp up and so what you really what were really looking for at Shelbyville, where we've made a significant investment in our stainless franchises to get that to a 100% of the expected volumes.
Yes.
Sure.
Yes.
I just hope you go right now.
Alan Weber: Good morning. How are you?
To those assets and where that product is going to go.
Eddie Lehner: Good morning. How are you?
Seven.
Alan Weber: Good.
Yeah.
Eddie Lehner: Alan, for you.
So if you will.
Alan Weber: Eddie, can you talk about, I do not know if it is possible, about the investments that you have made over the last few years? You need to think about the benefits, think about what you ultimately expected. How far along are you really? Or what ending are you? If you want to, you know, so what ending are you? If you want to, you know, phrase it.
Right.
Okay.
Yes go ahead.
Natus.
It sounds like what Youre, saying is right.
Thanks Scott.
Meet that internal rate of return case and really start to.
And market conditions, but if market conditions were flattish.
Thank you Paul.
Meet that.
Please.
Provide a better service and lower cost model out to the market because we are taking in heavier coils, which processes quills more efficiently at a lower cost and we can expand that material out both to our service centers to our customers with a better overall value proposition I think the timeline the timeline of return just <unk>.
Still it sounds as though given the early stages of seeing the improvements there and they will come even if it takes a little longer than originally expected.
Yes.
Service lower cost model.
Market.
Yes.
Yes.
Yes.
Eddie Lehner: Yeah, I mean, it is Alan, it is hard to run away from. I mean, it is hard to run away when you have higher volumes and you have, say, if you have more duration around, I would say, an upturn in pricing and demand, an upturn in pricing. The whole thing is going to look better. The whole thing is going to, that said, if we focus on Shelbyville, we are going to play a few. We focus on Shelbyville in a video. Shelbyville right now is probably at about 60. Shelbyville right now is probably at a ramp up. So what you really were really looking for out of Shelbyville, which you really what we have made a significant investment in our stainless array side, made it get back to 100% of the expected volume. Meet that internal rate of return case. Meet that.
Additionally.
Yes, no I think thats accurate I mean, it varies by project.
Thanks.
And that should allow us both to our space.
Here's some encouraging news right I mean contract tons are down 50000 tons year over year.
Correct.
Got it.
I think the timeline.
Given market conditions become a little bit extended thesis.
A return in this market.
Transactional tons were up 46000 tons year over year, you typically don't see an inverse relationship.
These conditions.
As intact as your previous investments up to full maturity. We operationalize. These things and then customers get used to that experience and we can also sell.
Come up with.
Alright.
Between those different segments of our business when we look at order type and I believe that the transactional pickups are really a result of us being in being able to normalize things in our network to a greater extent for example, we put a new cut to length line into Dallas and.
Oh maturity.
And then customers get used to that experience and regional.
To those assets and where that product is going to go.
Those assets and where that product is going up.
Right.
Yes go ahead.
Right.
It sounds like what you're saying is right.
Okay.
Yes.
And market conditions, but if market conditions were flattish.
Thank you.
That is now fully operational so we can start to get better volumes and throughput into that southwest marketplace. As an example, so happy about the transactional progress we got to continue to push on that.
Eddie Lehner: Really start to provide a better service and lower cost model and return that out to the market. Lower the cost taken and heavier put out to the market. We can run into oil additionally at a lower cost. We can expand that material out both to our service center, expand that customer out both times at better overall value and profit ratio. I think the timeline of return, I think the timeline of return comes a little bit down. It is Jesus size is a tad as you bring these investments on to pack as maturity. We operationalize these things full maturity. Then customers get used to that experience. Then customers get used to that experience too. Those assets where that product goes and where that product is going to go. You know, right now, you know, right now.
And market conditions market conditions.
Still it sounds as though you are in the early stages of seeing the improvements there and they'll come even if it takes a little longer than originally expected.
Mitch.
Joe.
Okay.
Sure.
Given it takes a little longer than originally expected.
And at the same time, our program business, we know it's going to come back and just really getting these projects up and going.
Yes, no I think thats accurate I mean, it varies by project.
I think that's accurate I mean it varies.
Here's some encouraging news right I mean contract tons are down to 50000.
Thank you.
It's encouraging.
To their fullest extent, but you are correct I mean, it's still early in that return cycle for sure.
One track down $50 now.
Tons year over year.
Transactional tons were up 46000 tons year over year, you typically don't see an inverse relationship.
Sure.
Transaction counts.
And then literally unrelated can you talk about the second half cash flow, what you're expecting and what you kind of where you hope to get.
It is now.
Year over year, you typically don't see.
Those different segments of our business when we look at order type and I believe that the transactional pickups.
Your relationship.
No.
Thank you.
When you look at it.
I believe that.
Leverage ratio say by the end of the year.
There are really a result of us being in being able to normalize things in our network to a greater extent for example, we put out a new cut to length line into Dallas and that is now fully operational so we can start to get better volumes and throughput into that southwest marketplaces.
Okay.
Alright.
Yes, I mean, it's going to be it's going to be a function obviously of EBITA.
Ian.
One of them.
Thank you.
We've discussed before we believe we're going to generate cash through the balance of the year. It is dependent on where prices go and where demand goes I mean frankly.
Thanks.
Alan Weber: It sounds like what you are saying is I understand market conditions, but market conditions and market conditions still sound as though you are in the early stages of seeing the improvements there. They will come. Maybe if it takes a little longer than originally expected, it takes a little longer than originally expected.
For example.
Our new coupled with Dupont.
Sure.
That is correct.
Yes.
If demand spiked upward and prices went up to I wouldn't mind it so much.
So we can start to get.
Into that southwest.
So happy about the transactional progress we've got to continue to push on that and.
We might have to finance working capital build in that case, but I do think our base case right. Now is we're going to generate cash to the balance of the year.
Yes.
Happy about the transformation progress we've got.
And at the same time, our program business, we know what is going to come back and just really getting these projects up and going.
Eddie Lehner: Yeah, no, I think that is accurate. I mean, it varies by the market, but I think that is accurate. I mean, it is very encouraging news, right? I mean, contract tons are down to 50 now. Contracts are down to 50. Transactional tons are up 46. Transactional reviews, you typically do not see an adverse relationship. You typically do not see the relationship between those different segments of our business. Those we look at order type. I believe that the transactional order types, I believe, are really a result of us being able to normalize things in our network to a greater extent. Things, for example, we put a new cut, for example, in the Dallas. A new. That is now in our only operation. That is what we can start to get better volumes in throughput. Start into that Southwest marketplaces. Into that Southwest.
Yes.
Okay.
Yes.
Okay, great. Thank you.
And just.
Thanks Alan.
Any of these projects.
To their fullest extent, but you are correct I mean, it's still early in that return cycle for sure.
Morning.
Yes.
And there are no further questions in the queue at this time I will now pass it back over to Eddie for closing remarks.
You are correct I mean, we're early in that return.
And then literally unrelated can you talk about the second half cash flow, what you're expecting and what you kind of where you hope to get.
And then.
Unrelated can you talk about that.
We appreciate your continued support of an interest in Ryerson, Please stay safe and be well I'll look forward to being with all of you in October for our third quarter 2025 of earnings release and conference call and please stay online or stay connected and I Hope you enjoyed the video Shelbyville.
Cash flow.
Okay.
Leverage ratio say by the end of the year.
We hope.
Leverage ratio say by the end of the year.
Yes, I mean, it's going to be it's going to be a function obviously of EBITDA.
Yes.
It's going to be a function of obviously the EBITDA.
We've discussed before.
We believe we're going to generate cash through the balance of the year. It is dependent on where prices go and where demand goes I mean frankly.
Good morning.
We believe we're going to generate cash to the balance sheet.
Okay.
Okay.
Right.
If demand.
Yes.
Right.
<unk> upward and prices went up to I wouldn't mind it so much.
Hi, My name is Joe model and operations manager for <unk>.
If demand.
And prices went up.
Eddie Lehner: Happy about the transactional progress. We have got to continue to plan on that progress. At the same time, our program business, we know it is going to come back and just really getting these projects up and going, getting these products to their fullest extent. You are correct. I mean, it is still early in that return. You are correct. It is still early in that return.
We might have to finance working capital build in that case, but I do think our base case right. Now is we're going to generate cash in the balance of the year.
Bluegrass facility at Shelbyville, Kentucky.
Sure.
Sure.
But I do.
Okay.
Right now is we're going to generate cash in the balance sheet.
Okay, great. Thank you.
As part of operation Bluegrass, an entire new Weil was added to the building Ryerson process models is comprised of 11 sites our capacities for RPM give us the opportunity to serve all of our <unk> markets.
Thanks Alan.
Okay, great. Thank you.
Thanks Alan.
And there are no further questions in the queue at this time I will now pass it back over to Eddie for closing remarks.
And there are no further question.
Alan Weber: And then just a little bit unrelated, talk about a little bit unrelated. Do you cash flow what you are expecting, cash flow, where you hope to get the leverage ratio say by the end of the year?
I'll now pass it back over to Eddie for closing remarks.
We appreciate your continued support of an interest in Ryerson, Please stay safe and be well I'll look forward to being with all of you in October for our third quarter 2025 of our earnings release and conference call and please stay online or stay connected and I Hope you enjoyed the video Shelbyville.
We appreciate it.
[music].
Yes.
Okay.
We streamlined our process flow, we've really brings all of our existing customer link clients. We've added a link capability with our new high speed efficient New York's Hudson Link line. We've added two new shipping lanes to improve our loadout times automated storage retrieval system has 2200 pockets that will hold up to 5000 and each of our aluminum and stainless sheet.
Iris.
Paul.
<unk>.
Okay.
Eddie Lehner: Yeah, it is going to be a function, obviously. Yeah, I mean, it is going to be a function, obviously. We believe we are going to generate cash. We are going to do it depending on how prices move in the value and go. Frankly, if demand spiked upward, if demand went up too, I would not buy that sellers. We might have to finance a working capital build in that space. But I do think our base case right now is we are going to generate cash to the value right now.
Sure.
Okay.
When we pay online.
And I hope you enjoyed the video in Shelbyville.
Okay.
Okay.
Hi, My name is Joe Mono and operations manager for Ross.
Sure.
My dog bluegrass facility at Shelbyville, Kentucky.
Okay.
We're going to be able to store sheets ready for shipment next day, we can fill seats faster than I've ever seen in 30 years.
Yes.
One zero.
Yes.
[music] as part of operation Bluegrass, an entire new Weil was added to the building. Prior some process models is comprised of 11 sites our capacities for RPM give us the opportunity to serve all of our Ryerson Mark.
Good morning.
Sure.
We've increased our productivity or in today it'll shift today, we've delivered tomorrow.
Okay.
Okay.
Alan Weber: Okay, great. Thank you. Okay, great. Thank you.
Okay.
As part of that.
Yes.
Our mission is to provide excellent customer experiences.
How are you.
Eddie Lehner: Thanks, Alan.
Right.
Molly Kannan: There are no further questions in the queue at the moment. I will now pass it back over to Eddie Lehner for closing remarks.
Hello.
Yes.
Constantly looking for ways to continuously improve our processes our technology our equipment.
Interest rates are.
Yes.
<unk>.
You need to serve all of our market.
Okay.
Eddie Lehner: We appreciate your continued support and interest. We appreciate your continued faith in me and will be well and the desire you involved in. I hope you will be well the rewards when you log in to the leasing and auditors call. Please stay on the line or stay connected. I hope you are on the line or Shelbyville connected. I hope you enjoy this video of Shelbyville.
We've added some great jobs to Shelby County, we've added almost 2000 employees to our staff over the last year. These folks take a lot of pride in what they do.
We streamlined our process flow, we've really brings all of our existing cuts of linked clients. We've added a link capability with our new high speed efficient New York's Hudson Link line. We've added two new shipping lanes to improve our load out times automated storage retrieval system has 2200 pockets that will hold up to 5000 pounds each of aluminum and stainless sheet.
Yeah.
We streamlined process flow.
All right.
Got it.
The metal that we ship out to our customers goes into many different products in the hospital industry Transportation industries Washers Dryers hospital beds, many things that affect all of US every day, we're very proud of that fact.
Hi.
One.
Thanks.
Okay.
Thank you our pocket.
Tim Monholland: Hi, my name's Tim Monholland, Operations Manager for Ryerson Holding Corporation. Like walking near a bluegrass facility in Shelbyville, Kentucky.
We're going to be able to store sheets ready for shipment next day, we can fill sheets faster than I've ever seen in 30 years.
Okay.
Okay.
It is.
Yes.
We'll see.
Hey, Ashwin.
Tim Monholland: Like walking near a bluegrass facility in Shelbyville, Kentucky.
We've increased our productivity or and today it will ship today, we delivered tomorrow.
Sure.
We've increased our productivity or.
Samuel Mckinney: As part of Operation Bluegrass, an entire new bay was added to the building. Ryerson Process Metals is comprised of 11 sites. Our capacities per RPM give us the opportunity to serve all of our Ryerson markets. We need to serve all of our Ryerson markets. We streamlined our process flow. We've rearranged all of our existing cut-to-link lines. We've added cut-to-link capability with our new high-speed, efficient EORD cut-to-link lines. We've added two new shipping lanes to improve our loadout times. Automated storage retrieval system has 2,200 pockets that will hold up to 5,000 pounds each of aluminum and stainless sheets. We're going to be able to store sheets ready for shipment next day. We can fill sheets faster than I've ever seen in 30 years. We've increased our productivity. Put an order in today. It will ship today. Be delivered tomorrow.
Our mission is to provide excellent customer experiences.
Great.
Sure.
This concludes today's call. Thank you for your participation you may now disconnect.
Our mission.
Constantly looking for ways to continuously improve our processes our technology our equipment.
Excellent.
Sure Austin.
Okay.
We've added some great jobs to Shelby County, we've added almost 20 employees to our staff over the last year. These folks take a lot of pride in what they do.
A group of products.
Thanks Jude.
Excellent.
Great.
In this call.
Sure.
Yes.
The metal that we ship out to our customers goes into many different products in the hospital industry Transportation industries Washers dryers hospital beds, and many things that affect all of US every day, we're very proud of that fact.
Please go ahead.
No.
Okay.
And it will be helpful.
Yeah.
Washer dryer.
[music].
Let me thank all of them.
We're very proud of that fact.
Okay.
Yes.
This concludes today's call. Thank you for your participation you may now disconnect.
Great. Thank you.
Samuel Mckinney: Our mission is to provide excellent customer experiences. We're constantly looking for ways to continuously improve our processes, our technology, our equipment. We've added some great jobs to Shelby County and added almost 20 employees to our staff over the last year. These folks take a lot of pride in what they do. The metal that we ship out to our customers goes into many different products in the hospital industry, transportation industries, washers, dryers, hospital beds, many things that affect all of us every day. We're very proud of that fact. Many things that all of us, we're very proud of that fact.
Thank you can now disconnect.
Molly Kannan: This concludes today's call. Thank you for your participation. You may now disconnect.