Ryerson Holding Corporation · NYSE:RYZ
Ryerson — BAML Leveraged Finance Conference 2017
34 slides from Ryerson's conference presentation, Nov 29, 2017
Slide 1: BAML Leveraged Finance Conference
BAML Leveraged Finance Conference November 2017 1
Slide 2: Important Information About Ryerson Holding Corporation
Important Information About Ryerson Holding Corporation These materials do not constitute an offer or solicitation to purchase or sell securities of Ryerson Holding Corporation (“Ryerson” or “the Company”) and no investment decision should be made based upon the information provided herein. Ryerson
Slide 3: Business Overview
Business Overview EDDIE LEHNER │ PRESIDENT & CHIEF EXECUTIVE OFFICER 3
Slide 4: Ryerson's Value Proposition
Ryerson’s Value Proposition Leading North American metals processor and distributor serving a diversified customer portfolio with a broad range of tailored solutions, services, and products Intelligent network of branded service centers with national, regional, and local presence creates a different
Slide 5: Ryerson's DNA – The "How" Really Matters
Ryerson’s DNA – The “How” Really Matters ANALYTICS SPEED CULTURE VALUE-ADD SCALE 5
Slide 6: Delivering Value to Customers: Understanding the "Elements"
Delivering Value to Customers: Understanding the “Elements” Is Vital to Profitable Growth Metal Shape Processing As Is Burn/Cut Fabrication Carbon 50% Stainless 24% Aluminum 24% Flat Long Plate Percent of 2016 Sales 6
Slide 7: Our Culture: Contributing to our customers' success
INDUSTRY-LEADING PERFORMANCE OPERATIONAL EFFICIENCY MARGIN EXPANSION PROFITABLE GROWTH Expense and working Optimize product and customer Growing share by leveraging capital leadership mix scale in highly fragmented market Significant operating leverage Value-added processing Multi-channe
Slide 8: Macro Outlook
Macro Outlook Volatile but Improved Commodity Inflection in U.S. Prices Since Dec. 31, 2015 Industrial Production in 2017 2.9 CRU HRC 2.2 2016-2017 2.3 LME Nickel Prices Indexed to Dec. 31, 2015 2.1 2.0 1.9 2.1 performance 2.0 LME Aluminum + Midwest Premium 1.5 1.4 0.8 1.8 0.4 0.0 +69% 1.6 -0.4 1.4
Slide 9: MSCI Demand Gap Persisting
MSCI Demand Gap Persisting U.S. Carbon and Stainless Average Monthly Shipments 5.0 4.5 Average Monthly Tons in Millions Tons Per Month Jan. '93 - Oct. '08 = 4.2 4.0 Nov. '08 - Present = 3.2 3.5 3.0 2.5 2.0 Source: Average annual shipments calculated using monthly Metals Service Center Institute data
Slide 10: Diverse End-Market Exposure
Diverse End-Market Exposure All Other, 7% Oil & Gas, 5% Commercial Ground Transportation, 16% Food Processing & Ag., 9% Metal Fabrication & Construction Machine Shops, 18% Equipment, 9% HVAC, 7% Consumer Durable, Industrial Machinery & 11% Equipment, 18% Percentages are based on 2016 sales as disclo
Slide 11: Driving Profitable Growth: Growing Market Share and Margins
Driving Profitable Growth: Growing Market Share and Margins U.S. Tonnage Market Share & RYI Gross Margin 4.2% 3.8% 3.8% Highly fragmented 20.0% U.S. Industry with: 17.9% 19.7% • 7,000 service centers 17.6% 16.4% • 1 million customers 16.0% • 30 million transactions 2014 2015 2016 per year Gross Marg
Slide 12: Ryerson's Important Growth Drivers
Ryerson’s Important Growth Drivers 1 2 3 4 Develop and diversify Coil & Sheet Franchise Stainless Products Scale prospecting & vertical markets Renewal Leadership call centers portfolio 5 6 7 8 Ryerson Virtual Ryerson Advanced Ryerson E-Commerce Long Products Depots Warehouse – Mapped Processing – v
Slide 13: Value-Added Metals Processor & Distributor with Scale & Broad Strategic Footprint
Value-Added Metals Processor & Distributor with Scale & Broad Strategic Footprint • Iconic industrial metals company founded in 1842 • Approximately 100 interconnected facilities in North America & China • Sales of $2.9 billion & shipments of 1.9 million tons in 2016 • Distributes 65,000 products to
Slide 14: One Ryerson: Differentiated Through Interconnectivity
One Ryerson: Differentiated Through Interconnectivity Enhanced intelligent systems for connecting people, supply chains, inventory, fixed assets, and logistics Benefits: Better asset utilization Texas Multi-Market Example • Shared and optimized inventory • Shared processing equipment Omni-Channel Sa
Slide 15: Optimizing Mix to Drive Margin Expansion
Optimizing Mix to Drive Margin Expansion: Expand Value-Added Processing 2010 SALES MIX 2016 SALES MIX Cut Long & Cut Long & Plate 3.0% Plate 4.8% Fabrication 6.7% Fabrication 9.2% As-Is Long $M, Tons 000's 2010 2016 Change & Plate As-Is Long 19.5% Cut to Tons Sold 2,252 1,903 (349) & Plate Cut to Le
Slide 16: Recent Acquisitions Growing our Value-Added Franchise
Recent Acquisitions Growing our Value-Added Franchise: Guy Metals & Laserflex • Guy Metals generates $35M in revenue from polished stainless and its trademarked “Pit Free Dairy” and “Super4” finishes • Laserflex generates $25M in revenue from laser fabrication and welding 16
Slide 17: Financial Overview
Financial Overview ERICH SCHNAUFER │ CHIEF FINANCIAL OFFICER 17
Slide 18: Quarterly Financial Highlights
Quarterly Financial Highlights $54.3 • Generated Adjusted EBITDA, excluding $51.5 LIFO of $37.7 million in Q3 ‘17. $48.8 • Gained market share with shipments up $36.0 $37.7 4.6% nine months year-to-date compared to industry shipments in North America, up 3.0% for the same period according to $14.8 t
Slide 19: Ryerson Financial Priorities
Ryerson Financial Priorities Deleveraging Propel growth with disciplined investment in high return capex & bolt-on acquisitions Maximize free cash flow Maintain industry-leading working capital and expense management 19
Slide 20: Deleveraging Increases Value for All Investors
Deleveraging Increases Value for All Investors Total Debt ($M) Annual Fixed Cash $1,242 Commitments ($M) Reduced total Cash Interest $ 80M debt $200M Pension and OPEB 30M $1,042 Maintenance Capital $1,024 15M Expenditures $964 Foreign and State Tax 5M Other 5M Annual Fixed Cash $ 135M Dec. 31, 2014
Slide 21: Investing to Drive Profitable Growth
Investing to Drive Profitable Growth • More than $100 million in growth capital invested since 2010 to expand value-added capabilities • Enhanced intelligent systems to connect people, supply chains, inventory, fixed assets, and logistics • Eight bolt-on acquisitions since 2010 21
Slide 22: Liquidity to Fund Operations and Investments
Liquidity to Fund Operations and Investments Liquidity ($M) $355 $301 38 50 26 Ryerson’s ability to maintain 26 ample liquidity affords us the $162.9 opportunity to further 291 225 deleverage for the benefit of all Ryerson stakeholders Dec. 31, 2016 Sep. 30, 2017 North American Availability Foreign
Slide 23: Proven Operational Efficiency and Industry Leadership
Proven Operational Efficiency and Industry Leadership: Consistent Execution of Fundamentals Days of Supply Expense Percentage of Sales Excluding D&A and One-Time Items 97 18.9% 95 92 90 90 17.0% 17.1% 84 16.2% 82 80 15.6% 76 74 13.8% 12.9% 12.5% 12.5% 11.9% 2013 2014 2015 2016 Q3 '17 2013 2014 2015
Slide 24: Conclusion
Conclusion EDDIE LEHNER │ PRESIDENT & CHIEF EXECUTIVE OFFICER 24
Slide 25: Our Commitment, Our Culture
Our Commitment, Our Culture Say Yes, Figure it Out 25
Slide 26: Appendix
Weeeee he aaa YEE Eb ‘Vii TAPS Hy [ | | ‘ a ee i" BAY UU Ned ot tl ov ‘aot A a Liye 1h, - a ry te ei | Fs q 4 mam te nha
Slide 27: Metal Service Center Supply Chain
Metal Service Center Supply Chain SUPPLIERS RYERSON CUSTOMERS • Manufacture metals • 65,000+ aluminum, carbon, and • Purchase smaller quantities stainless products • Produce & ship large volumes • Require a variety of products • Processes 75% of products sold and services • Have long lead times with
Slide 28: Experienced Management Team
Experienced Management Team Years in Years at Years in Executive Title Position Ryerson Industry Eddie Lehner* President & Chief Executive Officer 2 5 28 Erich Schnaufer** Chief Financial Officer 2 12 12 Executive Vice President, General Mark Silver 5 5 5 Counsel & Secretary Kevin Richardson Preside
Slide 29: Quarterly Financial Highlights
Quarterly Financial Highlights Tons Shipped (000’s) Average Selling Price Per Ton 518 515 $1,690 $1,678 $1,639 497 480 $1,531 $1,550 440 Q3 '16 Q4 '16 Q1 '17 Q2 '17 Q3 '17 Q3 '16 Q4 '16 Q1 '17 Q2 '17 Q3 '17 Gross Margin Gross Margin, Excluding LIFO 19.8% 19.7% 20.0% 19.6% 18.8% 16.8% 17.7% 16.8% 16.
Slide 30: Industry Math: 2016 MSCI Shipped Tonnage Mix
Industry Math: 2016 MSCI Shipped Tonnage Mix Industry Tons Mix Total Shapes 100% Flat 69% Carbon Flat Rolled 64% Stainless Sheet & Coil 3% Aluminum Sheet & Coil 2% Long 20% Key Long 10% All Other Long 10% Plate 11% Carbon Plate 9% Stainless Plate 1% Aluminum Plate 1% Key Long: aluminum and stainless
Slide 31: Non-GAAP Reconciliation
Non-GAAP Reconciliation EBITDA represents net income before interest and other expense on debt, provision for income taxes, depreciation, and amortization. Adjusted EBITDA gives further effect to, among other things, impairment charges on assets, reorganization expenses, and foreign currency transac
Slide 32: Non-GAAP Reconciliation: Quarterly
Non-GAAP Reconciliation: Quarterly ($M) Q3 '16 Q4 '16 Q1 '17 Q2 '17 Q3 '17 Net Sales 735.1 682.2 814.5 875.4 864.2 Gross Profit 145.4 114.6 160.6 140.4 145.0 Gross Margin 19.8% 16.8% 19.7% 16.0% 16.8% LIFO Expense (Income) 1.4 13.8 (0.7) 14.2 (1.7) Gross Profit, excluding LIFO 146.8 128.4 159.9 154.
Slide 33: Non-GAAP Reconciliation: Annual
Non-GAAP Reconciliation: Annual ($M) 2013 2014 2015 2016 Q3 '17 YTD Net Sales 3,460.3 3,622.2 3,167.2 2,859.7 2,554.1 Gross Profit 616.6 593.8 567.7 570.6 446.0 Gross Margin 17.8% 16.4% 17.9% 20.0% 17.5% LIFO Expense (Income) (33.0) 42.3 (59.5) (6.6) 11.8 Gross Profit, excluding LIFO 583.6 636.1 508
Slide 34: Ryerson
RYERSON
Ryerson Holding — BAML Leveraged Finance Conference 2017 on 6ix