Ryerson Holding Corporation · NYSE:RYZ
Ryerson — Q2 2022 Earnings Presentation
23 slides from Ryerson's earnings presentation, August 2022
Slide 1: Ryerson Quarterly Release Presentation Q2 2022
Ryerson Quarterly Release Presentation 1 Q2 2022
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”) or its subsidiaries and no investment decision should be made based upon the information provi
Slide 3: Q2 2022 Highlights
Q2 2022 Highlights • Record diluted EPS of $5.10 and Adjusted diluted EPS of $5.31 on $1.74 billion of revenue • Net Income1 of $196.4 million and Adjusted EBITDA, excluding LIFO of $224.2 million • Repurchased $186.9 million in 8.50% Senior Secured Notes due 2028 (the "Notes") • $47.7 million in
Slide 4: Macro & Commodities
Macro & Commodities Carbon steel and bright metals structurally higher despite slowing demand Commodity Prices Since Dec. 2017 U.S. Industrial Production CRU HRC 16.6 15.6 3.1 LME Nickel 9.2 LME Aluminum 5.9 7.0 5.6 4.9 4.7 5.0 4.9 4.8 3.9 3.7 4.2 2.9 2.6 Prices Indexed to Dec. 2017 1.0 (2.0) (3.6)
Slide 5: Sequential Q2 2022 End-Market Trends
Sequential Q2 2022 End-Market Trends North American volumes impacted by some end-market deferred demand; partially offset by increases in Oil & Gas, Commercial Ground Transportation, and Metal Fabrication and Machine Shops 2021 QoQ Volume Commentary Sales Mix1 Despite slowing demand due to a Metal F
Slide 6: Q3 2022 Guidance
Q3 2022 Guidance Ryerson anticipates a solid Q3 despite softening demand Diluted Earnings per Share Adj. EBITDA, Net Sales Net Income1 excl. LIFO $1.45 - 1.55B $90 - 98M $110 - 120M $5.10 $5.31 $4.17 4.27 Third quarter revenue guidance of $1.45B to $1.55B $3.25 $2.91 $2.71 2.68 assumes: $2.50 • Aver
Slide 7: Q2 2022 Selected Financial & Operating Metrics
Q2 2022 Selected Financial & Operating Metrics Asset Management Inventory Days of Supply Cash Conversion Cycle The Company’s cash conversion cycle driven by a 80 78 sequential increase days of supply Cash Flow Cash from operating activities Free Cash Flow Yield1 Second quarter cash flow generation w
Slide 8: Stronger Liquidity to Fund Operations and Investments
Stronger Liquidity to Fund Operations and Investments Revolving Credit Facility Extension and Amendment creates interest savings and flexibility $633 $588 $563 • Global liquidity increased to $507 $894M in Q2’22 from $760M in $492 Q1’22 $890 $698 $741 $760 $894 • Leverage maintained at historic Q2 2
Slide 9: Exercising Optional Redemption Features
Exercising Optional Redemption Features Ryerson has driven down net debt and fixed cash commitments as part of its financial transformation strategy, significantly reducing annual interest payments Reduced Net Debt ($M) Reduced Interest 2016 2020 Q1 Q2 Refinance Refinance 2021 2022 2022 Principal
Slide 10: Capital Allocation Plan Drives Value
Capital Allocation Plan Drives Value Driving accretive shareholder value through four key tenets • $100M planned • Competitive yield for 2022 • $74M on growth, • Q3 ‘22 dividend modernization, increased to value-add & $0.15/share intelligent systems • Successful track • $50M authorized & record of M
Slide 11: Shareholder Structure Improved
Shareholder Structure Improved 5.1 million share sell-down by controlling shareholder Platinum1 improves free float 38.7M • At March 31st Platinum owned 54% of Ryerson’s 37.1M shares outstanding, with remaining 46% freely floated Ryerson Repurchased 15.9 21.0 • On May 13th Platinum sold 5.1 (24%) of
Slide 12: Debt Opportunistically Retired
Debt Opportunistically Retired Consistently driven down high-yield debt as part of financial transformation strategy 600 115 • Oversubscribed tender allowed for increased 500 principal retirement through May ‘22 – from 400 110 $75M to $132M 300 • Additionally repurchased $54M of principal in Q2 2022
Slide 13: Capital Allocation Plan Update
Capital Allocation Plan Update Ryerson distributed its fourth quarterly cash dividend and completed ~1.6M in share repurchases. On August 3, 2022 the Board of Directors approved a fourth dividend increase, raising the Company’s third quarter dividend to $0.15 per share Q2 22 Allocation: $0.125 and $
Slide 14: Q2 2022 Key Financial Metrics
Q2 2022 Key Financial Metrics Strong quarter with record EPS and balance sheet milestones afford for greater future investment Diluted Earnings Net Sales Gross Margin Net Income1 Debt per Share $1.74B 26.7% $196.4M $5.10 $533.5M -0.3% QoQ +320 bps QoQ +$32.8M QoQ +$0.93 QoQ -$17.8M QoQ Gross Margin,
Slide 15: Intelligent Network of Industrial Metals Service Centers
Intelligent Network of Industrial Metals Service Centers Great customer experiences at speed, scale and consistency • Say “yes” culture • ~100 company-operated locations • Hundreds of “virtual” locations • Dedicated logistics network • Availability, speed, ease, consistency • Advanced value-add • Di
Slide 16: Appendix
Appendix 16
Slide 17: Quarterly Financial Highlights
Quarterly Financial Highlights Tons Sold (000’s) Average Selling Price Per Ton 559 519 474 528 524 $2,538 $3,035 $3,236 $3,312 $3,327 Q2 2021 Q3 2021 Q4 2021 Q1 2022 Q2 2022 Q2 2021 Q3 2021 Q4 2021 Q1 2022 Q2 2022 Gross Margin & Gross Margin, excl. LIFO Adj EBITDA, excl. LIFO & Net Income Margin %1
Slide 18: Ryerson Book Value and Balance Sheet Transformation
Ryerson Book Value and Balance Sheet Transformation Fixed Cash Commitments Leverage Ratio $148 $142 8.0 $136 $133 21 22 $115 16 17 6.0 31 34 32 $88 31 37 15 4.0 11 27 $48 0.5x 93 2.0 89 85 88 16 62 51 7 25 - 2 2016 2017 2018 2019 2020 2021 Q1 2022 1 2016 2017 2018 2019 2020 2021 1H 2022 Ryerson Avg.
Slide 19: Non-GAAP Reconciliation: Quarterly Adjusted EBITDA, excl. LIFO
Non-GAAP Reconciliation: Quarterly Adjusted EBITDA, excl. LIFO ($M) Q2 '21 Q3 '21 Q4 '21 Q1 '22 Q2 '22 Tons Sold (000's) 559 519 474 528 524 Net Sales 1,419.0 1,575.1 1,533.9 1,748.8 1,743.5 Warehousing, delivery, selling, general, and administrative expenses 178.3 180.2 180.9 175.3 182.9 Depreciati
Slide 20: Adjusted Net Income Reconciliation
Adjusted Net Income Reconciliation Q2 2022 reported net income1 of $196.4 million reflects a $3.8 million gain on sales of assets and a $14.5 million cash loss on the early retirement of debt. Excluding these tax effected impacts of $2.7 million, adjusted earnings were $204.4 million in Q2 2022 (Dol
Slide 21: Non-GAAP Reconciliations: Net Debt
Non-GAAP Reconciliations: Net Debt (In millions) Q2 ’21 Q3 ’21 Q4 ’21 Q1 ’22 Q2 ’22 Total debt 600.9 672.6 639.3 551.3 533.5 Less: cash and cash equivalents (38.1) (39.9) (51.2) (44.7) (41.4) Net debt $562.8 $632.7 $588.1 $506.6 $492.1 (In millions) 2018 2019 2020 2021 Total debt $1,153 $982 $740 $6
Slide 22: Non-GAAP Reconciliation
Non-GAAP Reconciliation Note: 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, reorganization expenses, gain on sale of assets, loss on retirement of debt,
Slide 23: Ryerson
RYERSON