Insteel Industries Inc (IIIN) 2026 Q3 法說會逐字稿

Hello, everyone. Thank you for joining us, and welcome to the Insteel Industries third-quarter 2026 earnings call. (Operator Instructions) I will now hand the conference over to H. Woltz, President and Chief Executive Officer. H., please go ahead.

各位好。感謝各位加入，歡迎參加 Insteel Industries 2026 會計年度第三季財報電話會議。(接線員指示) 現在我將把會議交給總裁兼執行長 H. Woltz。H.，請開始。

Thank you. Good morning. Thank you for your interest in Insteel, and welcome to our third-quarter 2026 conference call, which will be conducted by Scott Jafroodi, our Vice President, CFO, and Treasurer.

謝謝。早安。感謝各位對 Insteel 的關注，歡迎參加我們 2026 會計年度第三季電話會議；本次會議將由我們的副總裁、財務長兼財務主管 Scott Jafroodi 主持。

Before we begin, let me remind you that some of the comments made in our presentation are considered to be forward-looking statements that are subject to various risks and uncertainties which could cause actual results to differ materially from those projected. These risk factors are described in our periodic filings with the SEC.

在開始之前，提醒各位，我們簡報中的部分評論屬於前瞻性陳述，可能受到各種風險與不確定性影響，導致實際結果與預測有重大差異。這些風險因素已在我們向美國證券交易委員會（SEC）提交的定期申報文件中說明。

Despite falling short of our expected financial performance in Q3, we believe the upturn in business activity we reported previously is still intact. I'll turn the call over to Scot to comment on our financial results. And following his comments, I'll kick the call back up to discuss our business outlook.

儘管第三季的財務表現未達我們的預期，我們認為先前所提到的業務活動回升趨勢仍然存在。我先把電話交給 Scot，請他說明我們的財務結果。在他說明之後，我會再接回來討論我們的業務展望。

Thank you, H. And good morning to everyone joining us on the call. As reported in our earnings release this morning, third-quarter results benefited from higher average selling prices and improved shipment activity. However, those benefits were more than offset by higher costs, resulting in net earnings of $9 million or $0.46 per share compared with $15.2 million or $0.78 per share in the prior year quarter.

謝謝你，H。也向所有參與本次電話會議的各位道早安。如同我們今天早上發布的財報新聞稿所述，第三季的結果受惠於較高的平均銷售價格以及出貨活動改善。然而，這些利多被更高的成本所抵銷，導致淨利為 900 萬美元（每股 0.46 美元），相較於去年同期的 1,520 萬美元（每股 0.78 美元）。

Despite the decline in earnings, underlying demand trends remain generally favorable. Third-quarter shipments increased 1.7% from the prior-year quarter, supported by healthy infrastructure activity, although conditions across much of the broader private non-residential construction market remain soft. Wet weather in certain regions, together with scheduling and delivery delays on several customer projects, including data center-related projects, moderated the pace of shipments during the quarter.

儘管獲利下滑，基本需求趨勢整體仍大致有利。第三季出貨量較去年同期增加 1.7%，在基礎建設活動穩健的支撐下成長；不過，較廣泛的民間非住宅建築市場多數領域的景氣仍偏疲弱。部分地區的潮濕天候，加上多個客戶專案（包含與資料中心相關的專案）出現排程與交付延遲，放緩了本季出貨節奏。

We continue to view these project delays as timing-related rather than indications of weakening underlying demand. Overall, customer sentiment remains positive and activity across our key markets continue to support our outlook.

我們仍認為這些專案延遲屬於時點因素，而非基本需求轉弱的跡象。整體而言，客戶情緒仍然正向，我們主要市場的活動也持續支撐我們的展望。

Turning to pricing. Average selling prices increased 8.1% from the prior year quarter and 2.3% sequentially from the second quarter, reflecting the continued benefit of pricing actions implemented over the past year in response to higher steel wire rod, freight and other operating costs.

接著談定價。平均銷售價格較去年同期上升 8.1%，較第二季季增 2.3%，反映我們在過去一年因應鋼線盤元、運費及其他營運成本上升而採取的定價措施持續發揮效益。

Gross profit for the quarter declined $20.1 million from $30.8 million in the prior-year period, and gross margin contracted by 690 basis points to 10.2% from 17.1%. The year-over-year decline was driven primarily by narrow spread between selling prices and raw material costs, as well as higher freight and manufacturing costs. In addition, lower production volumes resulted in higher unit conversion costs which further pressured margins.

本季毛利為 2,010 萬美元，較去年同期的 3,080 萬美元減少 2,010 萬美元，毛利率也由 17.1% 收縮 690 個基點至 10.2%。年減主要原因是銷售價格與原物料成本之間的價差縮小，以及運費與製造成本上升。此外，較低的產量使單位轉換成本上升，進一步壓縮毛利率。

On a sequential basis, gross profit increased by $3.6 million from the second quarter and gross margin improved by 60 basis points, reflecting higher shipment volumes and improved spreads. Looking ahead to the fourth quarter, we expect gross margins to remain near current levels with the potential for modest improvement.

以季比來看，毛利較第二季增加 360 萬美元，毛利率改善 60 個基點，反映出貨量提高與價差改善。展望第四季，我們預期毛利率將維持在目前水準附近，並有小幅改善的可能。

Our outlook is supported by steady demand and improved manufacturing efficiency from higher production volumes and operating rates. However, significant margin expansion will depend on our ability to realize additional pricing increases sufficient to offset ongoing inflationary pressures in raw material, freight, and other operating expenses.

我們的展望受到需求穩定，以及在較高產量與稼動率下製造效率提升的支撐。然而，毛利率若要顯著擴張，將取決於我們能否實現進一步的漲價幅度，以足以抵銷原物料、運費及其他營運費用持續的通膨壓力。

SG&A expense for the quarter declined to $8.5 million or 4.3% of net sales, compared with $10.6 million or 5.9% of net sales in the prior-year period. The decrease was driven primarily by a $2.1 million reduction in compensation expense associated with our return on capital-based incentive plan, reflecting lower financial performance relative to the prior year.

本季銷售、一般及管理費用（SG&A）降至 850 萬美元，占淨銷售額 4.3%，相較去年同期為 1,060 萬美元，占淨銷售額 5.9%。下降主要來自與我們以資本報酬為基礎的獎酬計畫相關之薪酬費用減少 210 萬美元，反映本期相較去年財務表現較低。

Our effective tax rate for the quarter fell to 22.8% from 23.3% a year ago. Looking ahead to the balance of the year, we expect our effective rate to run close to 23%, subject to the level of pre-tax earnings, both tax differences, and the other assumptions and estimates that compose our tax revision calculation.

本季有效稅率由一年前的 23.3% 降至 22.8%。展望今年剩餘期間，我們預期有效稅率將接近 23%，但仍取決於稅前盈餘水準、各項稅務差異，以及構成我們稅務調整計算的其他假設與估計。

Turning to the cash flow statement and balance sheet. Operating activities generated $13.7 million of cash during the quarter, driven primarily by net earnings. Changes in net working capital had a minimal impact on cash flow, providing a $0.5 million during the quarter.

接著看現金流量表與資產負債表。本季營運活動產生現金 1,370 萬美元，主要由淨利所帶動。淨營運資金變動對現金流影響不大，本季提供 50 萬美元。

A $7.9 million increase in inventories, reflecting continued wire rod purchasing activity and higher average raw material costs, was mostly offset by a $7.8 million increase in accounts payable and accrued expenses related to those purchases. Our inventory position at the quarter end represented approximately 3.5 months of shipments on a forward-looking basis, calculated off of our fourth-quarter forecast, up slightly from 3.4 months at the end of the second quarter.

存貨增加 790 萬美元，反映持續的盤元採購活動以及較高的平均原物料成本；此影響大多被應付帳款與應計費用增加 780 萬美元（與上述採購相關）所抵銷。以前瞻基礎、依我們第四季預測計算，季末存貨水位約相當於 3.5 個月的出貨量，較第二季末的 3.4 個月略為上升。

As discussed on prior calls, inventory levels have remained elevated in fiscal 2026 as we supplemented domestic wire riot purchases with offshore material to support customer demand and mitigate supply risk. Looking ahead, we expect inventories just climbed monthly during the fourth quarter as shipment activity progresses through the seasonal busy period. Finally, inventories at the end of the third quarter were valued at an average unit cost that was generally consistent with both the costs reflected in the third-quarter cost of sales and current replacement costs.

如同先前電話會議所討論，2026 會計年度存貨水位維持偏高，因我們以海外材料補充國內盤元採購，以支撐客戶需求並降低供應風險。展望未來，我們預期第四季隨著出貨活動進入季節性旺季，存貨將逐月上升。最後，第三季末存貨以平均單位成本計價，整體上與第三季銷貨成本所反映的成本以及目前重置成本大致一致。

We invested $3.2 million in capital expenditures during the quarter, bringing total capital spending to $9.1 billion for the first nine months of fiscal 2026. Based on our updated forecast for the remainder of the fiscal year, we now expect full-year capital expenditures to total approximately $15 million, down from our previous estimate of $20 million. The revised outlook reflects the timing of certain projects rather than any changes in our underlying investment plans, with a portion of the related spending now expected to shift in the fiscal 2027.

本季我們投入資本支出 320 萬美元，使 2026 會計年度前九個月的資本支出總額達到 91 億美元。根據我們對本會計年度剩餘期間的最新預測，我們目前預期全年資本支出約為 1,500 萬美元，低於先前估計的 2,000 萬美元。此修正後的展望反映部分專案時程的變動，而非我們基本投資計畫的改變；其中一部分相關支出預期將遞延至 2027 會計年度。

Our strong balance sheet continues to provide significant financial flexibility. We ended the quarter with $22.9 million of cash and no borrowings outstanding on our $100 million revolving credit facility. During the quarter, we increased share repurchase activity under our existing authorization, repurchasing 75,000 shares for $1.9 million. We continue to believe our shares represent an attractive long-term investment and view share repurchases as an effective means of creating shareholder value when valuation levels are appropriate.

我們強健的資產負債表持續提供顯著的財務彈性。本季末我們持有現金 2,290 萬美元，且在 1 億美元的循環信用額度下沒有任何未償借款。本季我們在既有授權下提高庫藏股回購活動，回購 75,000 股，金額 190 萬美元。我們仍相信本公司股票具備具吸引力的長期投資價值，並認為在估值水準適當時，回購股份是創造股東價值的有效方式。

Our capital allocation priorities remain unchanged. We will continue to invest in the business to support growth initiatives and improve operating efficiency, maintain a strong balance sheet, and return excess capital to shareholders through a balanced approach of dividends and disciplined share repurchases.

我們的資本配置優先順序維持不變。我們將持續投資於業務，以支持成長計畫並提升營運效率、維持強健的資產負債表，並透過股利與審慎的股票回購相結合的均衡方式，將多餘資本回饋給股東。

Turning to the macro indicators for construction end markets. Recent data suggests conditions remain uneven. In May, the Architectural Billing Index declined to 44.5, its lowest reading since January, and remained well below the 50% threshold that separates expansion from contraction. According to the AIA, the decline reflects the continued uncertainty related to geopolitical tensions in the Middle East and higher energy costs, together with elevated interest rates, rising material prices, and persistent labor shortages.

接著談建築終端市場的總體指標。近期數據顯示，狀況仍不均衡。5月，建築師帳單指數（Architectural Billing Index）下滑至44.5，為自1月以來最低，且仍遠低於區分擴張與收縮的50%門檻。根據美國建築師學會（AIA），該下滑反映了與中東地緣政治緊張及能源成本上升相關的持續不確定性，再加上利率居高不下、材料價格上漲，以及長期存在的勞動力短缺。

The Dodge Momentum Index, which measures non-residential projects entering the planning stage, also pointed to some moderation in June. The index declined 1.9% for May, with the commercial component down 6.8%. While data center planning continues to be a key source of activity, Dodge noted that the pace moderated from the elevated levels seen in recent months.

衡量非住宅專案進入規劃階段的Dodge動能指數（Dodge Momentum Index）也顯示6月有所降溫。該指數在5月下滑1.9%，其中商業分項下跌6.8%。雖然資料中心規劃仍是活動的重要來源，Dodge指出，其增速較近月所見的高檔水準有所放緩。

Construction spending data from the US Department of Commerce also reflected mixed conditions. In May, total construction spending on a seedly adjusted annual basis increased just 0.1% from April and declined 1.5% from last May.

美國商務部的建築支出數據同樣反映出景氣分歧。5月，經季節性調整後的年率口徑下，建築總支出僅較4月增加0.1%，並較去年5月下降1.5%。

Total non-residential construction spending was essentially unchanged from April and was 3.8% below the prior-year level. However, highway and street construction, a key end market for our products, increased 3% from May of last year, reflecting the continued strength of publicly funded infrastructure activity. Taking together, these indicators support our view that the near-term environment remains mixed, but the underlying drivers of demand across our key end markets remain supportive.

非住宅建築總支出較4月基本持平，且較上年同期低3.8%。然而，公路與街道建設（為我們產品的關鍵終端市場）較去年5月成長3%，反映公共資金支持的基礎建設活動持續強勁。綜合而言，這些指標支持我們的看法：短期環境仍然分歧，但我們主要終端市場的需求基本驅動因素仍具支撐。

Looking ahead, shipment levels have improved from the weather-impacted second quarter, and customer activity remains favorable across many of the non-residential markets we serve. Although certain projects continue to move through the system more slowly than originally expected, we believe these delays are primarily timing-related and do not reflect weakening underlying demand.

展望未來，出貨水準已自受天候影響的第二季回升，而我們所服務的多個非住宅市場中，客戶活動仍然良好。儘管部分專案在系統中的推進速度仍較原先預期緩慢，我們認為這些延遲主要屬於時點因素，並不代表基本需求轉弱。

At the same time, we continue to navigate uncertainty related to raw material costs, freight expense, and trade policy. While we are monitoring these developments closely, we believe the company remains well-positioned as we move through the remainder of fiscal 2026. Our debt-free balance sheet and strong liquidity provides financial flexibility to invest in the business, pursue growth opportunities, and continue returning capital to shareholders.

同時，我們仍在因應與原物料成本、運費以及貿易政策相關的不確定性。雖然我們正密切監控這些發展，我們相信公司在2026會計年度剩餘期間仍具備良好定位。我們無負債的資產負債表與充裕流動性，提供了財務彈性，可用於投資業務、追求成長機會，並持續將資本回饋給股東。

This concludes my prepared remarks. I'll now turn the call back over to H.

以上為我預先準備的發言。接下來我把電話交回給H。

Thank you, Scot. Despite our relatively weak financial performance in Q3, I'm glad to report that we believe market conditions are holding up reasonably well and certainly well enough to support better financial performance from our company. In a nutshell, I would characterize infrastructure markets as reasonably strong and private non-residential construction absent data centers as quite weak.

謝謝你，Scot。儘管我們第三季（Q3）的財務表現相對疲弱，我很高興報告，我們認為市場狀況仍維持得相當不錯，且肯定足以支撐公司更佳的財務表現。簡而言之，我會將基礎建設市場形容為相對強勁，而除資料中心之外的民間非住宅建築則相當疲弱。

As reported last quarter, we've experienced schedule delays with respect to data center projects that are unavoidable under prevailing circumstances. These delays are related to later than anticipated start times for projects that necessarily back up delivery schedules for materials and equipment.

如同上季所報告，我們在資料中心專案方面遭遇了在現行情況下無可避免的排程延遲。這些延遲源於專案開工時間晚於預期，進而必然推遲材料與設備的交付排程。

I would reiterate comments from last quarter and from Scot that we're not seeing cancellations, just delays. We expect shipments to private non-res markets, including our data center projects, to accelerate during the current quarter and to remain strong through the end of the calendar year.

我想重申上季以及Scot所提到的：我們沒有看到取消，只是延遲。我們預期本季對民間非住宅市場（包含資料中心專案）的出貨將加速，並在今年年底前維持強勁。

Another obstacle adversely affecting our financial performance has been the impact of inflation on nearly every product or service we acquire to operate our plants. We've struggled to get in front of costs that are rising substantially in every aspect of the business. With that in mind, we announced a price increase that was recently effective to recover these rising costs.

另一個不利於我們財務表現的障礙，是通膨對我們為營運工廠而採購的幾乎每一項產品或服務所造成的影響。我們一直難以超前因業務各面向成本大幅上升所帶來的壓力。基於此，我們宣布了一項近期已生效的調價，以回收這些上升的成本。

Turning to another subject, the steel industry may have been more affected by the administration's tariff policy than any other industry. The Section 232 tariff of 50% on imports of steel has caused market prices in the US for hot-rolled wire rod, our primary raw material, to rise to a level that is 50% to 100% over the global market price. Realizing that foreign companies were circumventing the 232 tariff by downstreaming hot-rolled steel into finished products, to which 232 did not apply, in 2025, the administration applied the Section 232 tariff to downstream products derived from hot-rolled steel covered by the Section 232 tariff.

再談另一個主題，鋼鐵產業可能是受政府關稅政策影響最深的產業。對進口鋼材課徵50%的《232條款》（Section 232）關稅，已使美國熱軋線材（hot-rolled wire rod；我們的主要原料）的市場價格上升至較全球市場價格高出50%至100%的水準。鑑於外國公司透過將熱軋鋼向下游加工成《232條款》不適用的成品以規避232關稅，政府於2025年將《232條款》關稅適用範圍擴及由受《232條款》涵蓋之熱軋鋼所衍生的下游產品。

While we initially questioned the effectiveness of the derivative products tariff strategy implemented by the administration, we're glad to report a significant decline in the volume of imported PC strand that has entered the US since the tariff was increased to 50% and derivative products, including PC strand, were covered. For the first four months of calendar 2026, the most recent data available, PC strand imports fell 30% from the prior year, although the average unit values continue to reflect the availability of world market steel to our foreign competitors.

雖然我們起初質疑政府所採行的衍生產品關稅策略的有效性，但我們很高興報告：自關稅提高至50%且將包含PC鋼絞線（PC strand）在內的衍生產品納入涵蓋範圍後，進入美國的進口PC鋼絞線數量已大幅下降。以2026曆年前四個月（目前可得的最新數據）來看，PC鋼絞線進口量較上年下降30%，儘管平均單位價值仍反映出我們海外競爭對手可取得世界市場鋼材的情況。

Despite low AUVs of imports, prices in the most import-affected market have begun to recover as import volumes have declined and uncertainty in insurance and transport costs have increased. We intend to point out to trade policymakers the reality that US hot-rolled steel prices have risen so high relative to world market levels that the effectiveness of the derivative tariffs is compromised. Foreign competitors can still acquire hot-rolled steel at world market prices and simply pay the 232 tariff. Their economics still work, although uncertainty and other costs have risen substantially.

儘管進口品的平均單位價值（AUV）偏低，受進口影響最深的市場之價格已開始回升，原因在於進口量下降，以及保險與運輸成本的不確定性上升。我們打算向貿易政策制定者指出一個現實：美國熱軋鋼價格相對世界市場水準上升過高，以致衍生產品關稅的有效性受到削弱。外國競爭者仍可按世界市場價格取得熱軋鋼，並直接支付232關稅。他們的經濟性仍然成立，儘管不確定性與其他成本已大幅上升。

Turning to the raw material environment. It appears that domestic producers of the wire rod, our primary raw material, have increased margins to an extent that is satisfactory, and the rapid price escalation to take full advantage of the Section 232 tariff has run its course.

接著談原物料環境。看來國內線材（我們的主要原料）生產商已將利潤率提高到令人滿意的程度，而為充分利用《232條款》關稅所帶來的快速漲價也已告一段落。

Markets, while priced much higher than world markets, seem reasonably stable and calm. Because there continues to be a deficit in domestic production relative to domestic demand, Insteel will continue to import the portion of its requirement that cannot be sourced domestically and will continue to bear the net working capital implications.

市場價格雖仍遠高於世界市場，但似乎相當穩定且平靜。由於國內產量相對於國內需求仍存在缺口，Insteel將持續進口其無法在國內取得的需求部分，並將持續承擔其對淨營運資金的影響。

Ultimately, there must be capital investment in the domestic wire rod business for conditions of reasonable competition to be restored to the market. The wisdom of such investment will depend on the investor's view of the longevity of Section 232 tariff. Today, however, unplanned downtime at any producer of steel wire rod would cause marketplace havoc, and unplanned downtime has not been an unusual occurrence in this industry.

最終，國內線材產業必須進行資本投資，市場才能恢復合理競爭的狀態。此類投資是否明智，將取決於投資人對《232條款》關稅持續時間的看法。然而在當下，任何鋼線材生產商的非計畫性停機都會造成市場混亂，而非計畫性停機在此產業並非罕見。

Finally, turning to CapEx, as mentioned in the release and by Scott, we expect to invest approximately $15 million in our plants and information systems infrastructure during 2026. Our investments will support the growth of our engineered structural mesh business, reduce our cash production costs, and enhance the robust nature of our information systems. Consistent with past practice, we'll provide quarterly updates on our investment activities and expectations as the year progresses.

最後，談到資本支出（CapEx），如同新聞稿以及 Scott 所提到的，我們預期在 2026 年於我們的工廠與資訊系統基礎設施投資約 1,500 萬美元。我們的投資將支持我們工程結構網（engineered structural mesh）業務的成長、降低我們的現金生產成本，並強化我們資訊系統的穩健性。一如以往，隨著年度推進，我們將按季提供投資活動與預期的更新。

Looking ahead, we are aware of the substantial risk related to the state of the economy and the administration's tariff and trade policies. Regardless of developments in these areas, we are well positioned to pursue growth-related activities, both organic and through acquisition and actions to optimize our costs.

展望未來，我們注意到與經濟狀況以及政府的關稅與貿易政策相關的重大風險。無論這些領域如何發展，我們都已做好充分準備，推動與成長相關的活動，包括有機成長與併購，以及採取行動以優化成本。

This concludes our prepared remarks, and we'll now take your questions. [Jen], would you please explain one more time the procedure for asking questions?

以上為我們事先準備的發言，接下來我們將開始回答各位的提問。 [Jen]，請您再說明一次提問的流程，好嗎？

(Operator Instructions) Julio Romero, Sidoti.

(接線員指示) Julio Romero，Sidoti。

The data center-related delays that were cited on the April call, it sounds like none of those volumes were realized as of the June quarter end. Can you confirm that's correct? And if so, based on your visibility into the project, can you speak to the confidence about the acceleration in those projects occurring here in the current fourth quarter?

在 4 月那通電話中提到的與資料中心相關的延遲，聽起來截至 6 月季度末，這些出貨量都尚未實現。你能確認這點是否正確嗎？如果是的話，基於你對該專案的能見度，你能談談對於這些專案在目前第四季加速推進的信心程度嗎？

We can confirm the delay for sure, but anything we would say about expectations going forward is as of today and subject to change. But as I said in the prepared remarks, we expect those shipments to pick up during the current quarter and to remain strong through the end of the calendar year. But it is a day-to-day matter. We're learning a lot as we go through this process.

我們可以確定延遲確實存在，但我們對未來的任何預期都僅以今天為準，且可能隨時變動。不過如同我在準備好的發言中所說，我們預期這些出貨會在本季回升，並在今年曆年年底前維持強勁。但這是需要每天追蹤的事情。我們在推進這個流程的過程中也學到很多。

Got it. That is helpful, and that makes sense. Once deliveries begin for this one project or this current batch of projects you're supplying, how far do you expect that to extend? I think you said, as you said, through the end of the calendar year. But I think in the past, you said it would extend into fiscal '27, so just trying to get any finer point on the duration if possible.

了解。這很有幫助，也合理。一旦這個專案或你們目前供應的這批專案開始交付，你們預期會延續多久？我想你說過，如你所說，會到今年曆年年底。但我記得過去你曾提到會延伸到 27 財年，所以如果可以的話，想更精確了解一下期間長度。

And that's hard for me to answer, Julio, because I don't recall the details. I've been more focused on when we start shipping than how far it goes, and we're involved in multiple projects. It's not it's not just one. And the nature of this is that once we begin shipping, we will ship on a regular basis until the project is complete, but the material is not needed at the job site until the contractor's ready for it. That's sort of where we are.

Julio，這個問題我很難回答，因為我不記得細節。我比較專注在我們何時開始出貨，而不是會持續多久，而且我們參與的是多個專案。不、不只是單一專案。而這類專案的特性是，一旦我們開始出貨，就會定期出貨直到專案完成，但材料在工地端要等承包商準備好才需要。我們目前大概就是這樣的狀況。

Okay. No, that makes sense. Once this project or the group of projects is complete, can you talk about maybe the prospects for repeat business with the developer, the contractor, or the end user of that data center, how you had that conversation with them? Just speak to that if you could.

好的。不，這很合理。等這個專案或這一組專案完成後，你能談談是否有機會與開發商、承包商或該資料中心的終端用戶產生重複訂單嗎？你們是否已與他們討論過？如果可以的話，請談談這點。

Well, where we're going with this and the way we think about it is that there's 9 or 10 million tonnes of rebar used in this market on an annual basis. And based on the capacity additions that you're seeing in that market, certainly producers of rebar expect that number to rise substantially in the coming years.

嗯，我們對此的方向與思考方式是：這個市場每年使用約 900 萬到 1,000 萬噸的鋼筋（rebar）。而根據你在該市場看到的產能擴增，鋼筋生產商當然預期未來幾年這個數字會大幅上升。

Our needs and our aspirations are really very small part of the rebar market, but we have a valid value proposition that is important to customers, and we intend to exploit that. So this is a new undertaking for our company relatively. And as I said a few minutes ago, we're learning a lot, but we expect this to ramp up to be a substantial contributor to Insteel's revenue base over time.

我們的需求與企圖心其實只占鋼筋市場很小的一部分，但我們有一個對客戶很重要、且確實成立的價值主張，我們打算加以發揮。所以相對而言，這對我們公司算是一項較新的嘗試。而如同我幾分鐘前所說，我們學到很多，但我們預期隨時間推進，這將逐步擴大，並成為 Insteel 營收基礎的重要貢獻來源。

Data centers notwithstanding. If it doesn't go to data centers, it goes somewhere else. We're beginning to see some signs of life and other private non-residential applications, but that'll be a 2027 or 2028 recovery, in my view.

不論是否是資料中心。如果不是用在資料中心，就會用在其他地方。我們開始在其他民間非住宅應用看到一些復甦跡象，但依我看，那會是 2027 或 2028 年的復甦。

Perfect, and thank you for going into that and excuse me for trying to get ahead of myself and thinking about that part of the story, but just the valid value proposition beyond data centers, would that apply to like large reshore or onshoring facilities, other mega projects for the benefit of accelerating construction speed would also apply?

很好，謝謝你深入說明；也抱歉我有點超前思考、把故事的那一段先拿來問。

Well, yeah, I think what we're learning is that we need to target applications where the speed of construction is important to the owner and the contractor, which would imply maybe not so much speculative building as strategic building. And in those applications, we have a distinct advantage and, as I said, intend to exploit it.

嗯，是的。我想我們正在學到的是：我們需要鎖定那些對業主與承包商而言「施工速度」很重要的應用，這可能意味著相較於投機性建築（speculative building），更偏向策略性建築（strategic building）。在這些應用上，我們有明顯優勢，而且如我所說，我們打算加以發揮。

We need repetition. We don't need small cut-up structures because it's harder for us to be -- or it's harder for our value proposition to be realized in that kind of structure. So we're looking at larger buildings.

我們需要可重複性。我們不需要那種小型、零碎切割的結構，因為在那類結構中，我們較難——或者說，我們的價值主張較難被充分實現。所以我們在看的是更大型的建築。

Okay. Perfect. One more for me, and I'll turn it over if I could. Just last quarter, you cited an expectation to kind of not book any sort of receivable with regards to the IPA tariffs. Just curious if there's any change on that stance and where do vendor conversations kind of stand on recovering and passing through any of those IPA tariffs you paid last year.

好的。很棒。我再問最後一個，然後我就把時間讓給其他人。就在上一季，你們提到對於 IEEPA 關稅，預期不會認列任何應收款。想請問這個立場是否有任何改變？以及就你們去年支付的 IEEPA 關稅，與供應商之間在追回與轉嫁方面的討論目前進展如何？

We're going to record them when we receive them. And it's limited as far as the tariffs that we were the importer of record on. A vast majority of the tariffs that we paid someone else's importer of record, so we're waiting for them to file all the paperwork.

我們會在收到款項時才入帳。而且範圍僅限於那些我們是名義進口商（importer of record）的關稅。我們支付的大多數關稅，其名義進口商是其他人，所以我們在等他們把所有文件都提交完成。

And the other reality is that this repayment scheme was mandated by the Court of International Trade. And at the end of June, the Trump administration appealed that ruling. So the adjudication of the legality of the IEEPA tariffs has a long way to run. I would say that this is not something that we or any other company should hold our breaths to receive.

另外一個現實是，這個退款機制是由美國國際貿易法院（Court of International Trade）所要求的。而在 6 月底，川普政府對該裁決提出上訴。因此，關於 IEEPA 關稅合法性的裁定還有很長的路要走。我會說，這不是我們或任何其他公司應該屏息以待、指望很快收到的事情。

Tyson Bauer, KC Capital.

Tyson Bauer，KC Capital。

Just a quick bookkeeping one. On the SG&A, the $2.1 million that you highlighted, Scott, is part of that just a not having the recognition of an incentive comp because of your current run rate? Or is part of that function plus a clawback from what you recognized in the first two quarters?

我快速問一個會計處理的問題。關於 SG&A，你提到的那 210 萬美元，Scott，其中一部分是否只是因為目前的營運表現（run rate）而沒有認列激勵薪酬？或者其中一部分是因為把前兩季已認列的金額回沖（clawback）？

No, there's no clawback. It was just the pace of accruing that expense was at a lower level due to the reduced financial results.

不，沒有追索（clawback）。只是因為財務成果下滑，該費用的提列速度較慢、金額較低。

So that would indicate that your anticipation for this final fiscal quarter, we're pretty much on this run rate that we're currently seeing.

所以這表示你們對本財年最後一季的預期，基本上會維持在我們目前看到的這個運行水準（run rate）上。

Yes. Obviously, that would depend on how Q4 plays out. But yes, that would be how it would work.

是的。當然，這取決於第四季的實際表現。但沒錯，運作方式會是如此。

Was there any other impact due to the surrender value of life insurance because of the share price?

因為股價的關係，壽險的解約價值是否還有其他影響？

Yes, there was a $300,000 pickup in the cash surrender value of life insurance policies based on the market returns.

是的，根據市場報酬，壽險保單的現金解約價值增加了30萬美元。

You talked about price increases, is that a one-time price increase that you're pushing through and what was the effective date or are you looking at this at multiple increases through this current quarter?

你提到漲價，這是一次性的漲價推進嗎？生效日是什麼時候？還是你們打算在本季內進行多次調漲？

We've seen multiple increases through fiscal 2026 as we tried to recover rising (inaudible) costs as well as rising costs for everything else. And the most recent price increase that we announced was to be effective July 13, which as you know, is this week, and nobody likes price increases. And we don't like having to float price increases, but when a crop fit costs $1,500 to send to a destination, now it costs $3,000, somebody's got to pay the bill. And when I read about the inflation rate as reported by the administration, I can promise you it bears no reality to what we're seeing in the industrial sector.

我們在2026財年期間已經看到多次調漲，因為我們試圖回收上升的（聽不清）成本，以及其他所有項目的成本上升。而我們最近宣布的漲價將於7月13日生效，如你所知，就是本週；沒有人喜歡漲價。我們也不喜歡必須提出漲價，但當一個貨櫃運到目的地的成本從1,500美元變成3,000美元，總得有人買單。而當我讀到政府所公布的通膨率時，我可以向你保證，那與我們在工業領域所看到的情況完全不符。

Well, obviously, if you're just doing it this week, you probably don't have the early returns. I was going to ask how you characterize your pricing power. It seems like freight is a fairly universal -- nobody has an advantage on those costs. Everyone must be absorbing or having to push those along.

嗯，顯然如果你們是這週才做，可能還沒有早期回饋。我本來想問你們如何描述你們的定價能力。看起來運費是相當普遍的——沒有人在這些成本上有優勢。每個人都必須吸收或是把成本轉嫁出去。

Yeah, and that's only one of the costs that we're trying to recover, Tyson. And we're doing this in a market that as we characterize it, it's reasonably okay, but we're not doing it in a market that is bullishly strong. So it's difficult to collect it.

是的，Tyson，而那只是我們試圖回收的成本之一。而且我們是在一個我們形容為「還算可以」的市場中做這件事，但並不是在一個非常強勢的多頭市場中。所以要把它收回來是困難的。

But at the same time, you have two choices. You either absorb these costs, or you pass them along. And our choice is to pass them along and not absorb them. So yeah, we'll just have to see how it goes. But to say that our customers or even our people internally are happy about this, the answer would be we're certainly not. We don't like the environment.

但同時，你有兩個選擇。你要嘛吸收這些成本，要嘛把它轉嫁出去。我們的選擇是轉嫁，而不是吸收。所以，是的，我們只能看看結果如何。但若要說我們的客戶，甚至我們內部的人，對此感到高興嗎？答案是我們當然不高興。我們不喜歡這樣的環境。

And that kind of leads into the next topic of demand concentration and are your results going to be more variable or volatile because the larger product or projects are included in your revenue streams. So just based on industry and geography, that kind of concentration that we're seeing and also, I was going to ask about data centers being more of a backfilling function as opposed to incremental, but if you're truly not shipping and they're delayed and we're not recognizing data center revenue currently to what you think you will be. It really can't be much of a backfill operation, it must be incremental as we go forward.

這也引出下一個主題：需求集中度。由於較大型的產品或專案被納入你們的營收來源，你們的業績是否會變得更不穩定或更具波動？所以就產業與地理區域而言，我們看到的那種集中度；另外我也想問，資料中心是否更像是補缺（backfilling）而非增量，但如果你們其實沒有出貨、而且延遲，且目前並未認列你們認為應該會有的資料中心營收，那它就不太可能只是補缺作業，未來應該會是增量。

No, I'll consider it a key part of our market going forward. And as we have acknowledged forever, this is a volatile, cyclical, seasonal business. So what happens in any one quarter, I can't really say. But if you give us two to five years, you're going to see that a tremendous part of our revenue is coming from markets that we did not participate in two years ago.

不，我會把它視為我們未來市場中的關鍵部分。而且我們一直以來都承認，這是一個波動、循環且具季節性的產業。所以任何單一季度會發生什麼，我真的很難說。但如果你給我們兩到五年，你會看到我們相當大一部分的營收，將來自於兩年前我們尚未參與的市場。

Okay. So it has somewhat of a similar effect as when we saw in 2021, '22, the distribution center boom that went through and then kind of waned off. This is just the next iteration of a different industry segment that's picked up that boom.

了解。所以它的效果有點類似於我們在2021、2022年看到的配送中心（distribution center）熱潮，之後又逐漸降溫。這只是下一輪由不同產業區隔接棒的熱潮。

Is it? Yes, it is. I mean, the distribution centers have tailed off dramatically, but I would just say again that whether it's data centers or whether it's distribution centers or some other application, there's still 9 or 10 million tonnes of rebar used in the US every year, and that must be going to 11 or 12. And we're going to be there taking part of it in whatever applications happen to be robust at the time.

是嗎？是的，沒錯。我的意思是，配送中心的需求確實大幅降溫，但我還是要再說一次：不管是資料中心、配送中心或其他應用，美國每年仍會使用900萬到1,000萬噸的鋼筋（rebar），而這個數字必須成長到1,100萬到1,200萬噸。而無論當時哪些應用最強勁，我們都會在那裡參與並取得其中一部分。

Okay. When you see the headlines on data center moratoriums and all the angst, do you kind of write that off as just election politics and once we get beyond that season, we'll start to get into a more regular flow and that doesn't make the headlines like it currently is in New York or other places?

了解。當你看到關於資料中心暫停令（moratoriums）以及各種焦慮的新聞標題時，你是否會把它視為只是選舉政治？等過了那個時期後，流程會回到更正常的節奏，也就不會像現在在紐約或其他地方那樣成為頭條？

Our guys are pretty savvy about this and we're only talking to people who are pursuing projects that are permitted and funded. So I wouldn't expect to have to tell you guys that projects that we believe we're going to participate in were deferred or canceled because they couldn't be permitted or because of public opposition. We don't have time to chase those.

我們的人對這些很精明，我們只會和那些在推進已取得許可且已獲資金的專案的人交談。所以我不預期需要告訴各位：我們認為會參與的專案，因為無法取得許可或因為公眾反對而被延後或取消。我們沒有時間去追那種案子。

And the last one, I guess in the same vein as you'll report it when it happens on tariff-free funds, residential construction activity, a turn in that industry, when it happens, we'll believe it as opposed to trying to forecast it.

最後一個問題，我想也是同樣的邏輯：你們會在事情發生時再報告，例如免關稅資金、住宅建築活動、該產業的轉折；等它真的發生時我們才會相信，而不是試著去預測。

Yeah, it's certainly -- residential applications are on their back right now. There's a lot of price competition in products for residential applications, and it's just not our big strategic focus anyway. So we wouldn't spend a lot of time trying to forecast when that recovers.

是的，住宅相關應用現在確實很低迷。住宅應用產品的價格競爭非常激烈，而這本來也不是我們重大的策略重點。所以我們不會花太多時間去預測它何時復甦。

There are no further questions at this time. I will now turn the call back to H. Woltz for closing remarks.

目前沒有進一步的問題。我現在把電話交回給H. Woltz作結語。

Okay. Thank you. We appreciate your interest in the company and your participation on the call today, and are glad to hear from you if you want to give us a call during the coming quarter, and we look forward to talking with you at the end of the fiscal year. Thank you.

好的。謝謝。感謝各位對本公司的關注以及今天參與本次電話會議；如果各位在接下來這一季想與我們聯繫，歡迎來電，我們也期待在財年結束時再與各位交流。謝謝。

This concludes today's call. Thank you for attending. You may now disconnect.

今天的電話會議到此結束。感謝各位出席。各位現在可以掛線。