Reliance Inc (RS) 2023 Q1 法說會逐字稿

Greetings, and welcome to the Reliance Steel & Aluminum Company First Quarter 2023 Earnings Call. (Operator Instructions) As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Kim Orlando with ADDO Investor Relations. Please go ahead.

您好，歡迎來到 Reliance Steel & Aluminum Company 2023 年第一季度財報電話會議。 （操作員說明）提醒一下，正在錄製此會議。現在我很高興向您介紹 ADDO 投資者關係部的主持人 Kim Orlando。請繼續。

Thank you, operator. Good morning, and thanks to all of you for joining our conference call to discuss Reliance's first quarter 2023 financial results. I am joined by Karla Lewis, President and Chief Executive Officer; Steve Koch, Executive Vice President and Chief Operating Officer; and Arthur Ajemyan, Senior Vice President and Chief Financial Officer. A recording of this call will be posted on the Investors section of our website at investor.rsac.com.

謝謝你，運營商。早上好，感謝大家參加我們的電話會議，討論 Reliance 2023 年第一季度的財務業績。總裁兼首席執行官 Karla Lewis 加入了我的行列； Steve Koch，執行副總裁兼首席運營官；高級副總裁兼首席財務官 Arthur Ajemyan。此次通話的錄音將發佈在我們網站 investor.rsac.com 的“投資者”部分。

The press release and the information on this call may contain certain forward-looking statements, which are based on a number of assumptions that are subject to change and involve known and unknown risks, uncertainties or other factors, including the impacts of inflation, geopolitics and the COVID-19 pandemic and related economic conditions on our future operations. Which may not be under the company's control and may cause the actual results, performance or achievement of the company to be materially different from the results, performance or other expectations implied by these forward-looking statements.

新聞稿和本次電話會議的信息可能包含某些前瞻性陳述，這些陳述基於許多可能發生變化的假設，並涉及已知和未知的風險、不確定性或其他因素，包括通貨膨脹、地緣政治和COVID-19 大流行和相關經濟狀況對我們未來運營的影響。這可能不在公司的控制之下，並可能導致公司的實際結果、業績或成就與這些前瞻性陳述所暗示的結果、業績或其他預期存在重大差異。

These factors include, but are not limited to, those factors disclosed in the company's annual report on Form 10-K for the year ended December 31, 2022, under the caption Risk Factors, disclosure in our press release this morning and other documents, Reliance files or furnishes with the Securities and Exchange Commission. The press release and the information on this call speak only as of today's date and the company disclaims any duty to update the information provided therein and herein.

這些因素包括但不限於公司在截至 2022 年 12 月 31 日的 10-K 表格年度報告中披露的風險因素標題下的那些因素，今天上午在我們的新聞稿和其他文件中披露，Reliance向證券交易委員會備案或提供。本次電話會議的新聞稿和信息僅在今天發表，公司不承擔任何更新其中和此處提供的信息的義務。

I will now turn the call over to Karla Lewis, President and CEO of Reliance.

我現在將電話轉給 Reliance 總裁兼首席執行官 Karla Lewis。

Good morning, everyone, and thank you all for joining us today to discuss our first quarter 2023 financial results. I'll begin with an overview of our performance and capital allocation strategy. Steve will then speak to our operating results and demand trends by end market, and Arthur will conclude with a review of our financial results and outlook for the second quarter of 2023.

大家早上好，感謝大家今天加入我們討論我們 2023 年第一季度的財務業績。我將首先概述我們的業績和資本配置策略。然後，Steve 將按終端市場介紹我們的經營業績和需求趨勢，Arthur 將回顧我們 2023 年第二季度的財務業績和展望。

Beginning with our first quarter performance. We started the year off strong as our highly diversified business model continued to yield favorable results in an uncertain business environment. Our first quarter net sales of $3.97 billion increased approximately 10% from the fourth quarter of 2022. Our sales benefited from solid demand in the vast majority of our end markets, with our tons sold up 17.7% from the fourth quarter of 2022 which were partially offset by a lower average selling price. This was the highest sequential increase from the fourth quarter we've seen in our tons sold in the last decade.

從我們第一季度的業績開始。由於我們高度多元化的業務模式在不確定的商業環境中繼續產生良好的業績，我們今年開局強勁。我們第一季度的淨銷售額為 39.7 億美元，比 2022 年第四季度增長了約 10%。我們的銷售得益於絕大多數終端市場的強勁需求，我們的噸銷量比 2022 年第四季度增長了 17.7%，其中部分原因是被較低的平均售價所抵消。這是我們在過去十年中銷售的噸數自第四季度以來的最高連續增幅。

Our strong volumes which benefited from our investments in organic growth, a robust gross profit margin of 3.9% and disciplined expense control helped drive pretax income of $508.5 million and diluted earnings per share of $6.43, well ahead of our expectations. Our strong profitability along with effective working capital management enabled us to generate significant first quarter operating cash flow of $384.6 million.

得益於我們對有機增長的投資、強勁的 3.9% 毛利率和嚴格的費用控制，我們的強勁銷量幫助推動了 5.085 億美元的稅前收入和 6.43 美元的攤薄後每股收益，遠超我們的預期。我們強大的盈利能力以及有效的營運資金管理使我們能夠在第一季度產生 3.846 億美元的可觀運營現金流。

Turning to capital allocation. Our consistent cash generation continues to fuel our strategy of investing in growth activities and returning capital to our stockholders. Our capital expenditure budget for the full year 2023 remains a record $500 million, with spend of $102.9 million in the first quarter and an expected total cash outlay of approximately $400 million to $450 million this year. We expect approximately 2/3 of this budget will be invested in growth projects up from roughly 50% historically as we continue to invest in various facility upgrades, efficiencies and expansion into new markets.

轉向資本配置。我們始終如一的現金產生繼續推動我們投資於增長活動和向股東返還資本的戰略。我們 2023 年全年的資本支出預算仍然是創紀錄的 5 億美元，第一季度的支出為 1.029 億美元，預計今年的現金支出總額約為 4 億至 4.5 億美元。我們預計該預算的大約 2/3 將投資於增長項目，高於歷史上的大約 50%，因為我們將繼續投資於各種設施升級、效率和新市場擴張。

Our investments include new cutting-edge equipment to expand our value-added processing capabilities to further bolster our market position and margin profile as well as investments to provide safer working environments for our employees. While we did not complete any acquisitions during the first quarter, the pipeline remains healthy. We continue to evaluate a wide variety of prospective opportunities and remain well positioned to pursue those that meet our disciplined criteria for high-quality growth. Concurrent with our growth initiatives, we returned $100.9 million to our stockholders in the first quarter through a combination of dividends and share repurchases. Since 2018, we have allocated over $2 billion of capital towards organic growth and acquisitions and nearly $2.8 billion towards stockholder returns in the form of dividends and share repurchases.

我們的投資包括新的尖端設備，以擴大我們的增值加工能力，進一步鞏固我們的市場地位和利潤率，以及為我們的員工提供更安全的工作環境的投資。雖然我們在第一季度沒有完成任何收購，但渠道仍然健康。我們將繼續評估各種潛在機會，並保持有利地位，以追求那些符合我們高質量增長嚴格標準的機會。在實施我們的增長計劃的同時，我們在第一季度通過股息和股票回購相結合的方式向股東返還了 1.009 億美元。自 2018 年以來，我們已分配超過 20 億美元的資本用於有機增長和收購，並以股息和股票回購的形式分配近 28 億美元用於股東回報。

In summary, we are very pleased with our first quarter performance, both operationally and financially. We continue to execute our strategy in a dynamic environment with metal pricing volatility, ongoing inflationary headwinds, recessionary concerns, supply chain disruptions and labor shortages. Nevertheless, our managers in the field continued to do an excellent job upholding our superior levels of service and providing increasing levels of value to our customers. We maintain our belief that Reliance remains very well positioned to capitalize on opportunities resulting from the Infrastructure Bill, the CHIPS Act and the Inflation Reduction Act in an environment with relatively higher metal pricing versus historical levels.

總之，我們對第一季度的運營和財務表現感到非常滿意。我們繼續在充滿金屬價格波動、持續的通脹逆風、經濟衰退擔憂、供應鏈中斷和勞動力短缺的動態環境中執行我們的戰略。儘管如此，我們在該領域的經理繼續出色地工作，維護了我們卓越的服務水平，並為我們的客戶提供了更高水平的價值。我們仍然相信，在金屬價格相對於歷史水平相對較高的環境中，Reliance 仍然處於有利地位，可以利用基礎設施法案、CHIPS 法案和通貨膨脹減少法案帶來的機會。

Thank you to our extraordinary team at Reliance for your commitments to working safely and successfully executing our model. Thank you all for your time today. I'll now turn the call over to Steve, who will review our first quarter operating results and demand trends.

感謝我們在 Reliance 的非凡團隊，感謝你們對安全工作和成功執行我們模型的承諾。謝謝大家今天的時間。我現在將電話轉給史蒂夫，他將審查我們第一季度的經營業績和需求趨勢。

Thanks, Karla, and good morning, everyone. I'd also like to express my gratitude to our dedicated team at Reliance for their outstanding operational execution and ongoing commitment to safety. I'll now turn to our first quarter demand and pricing trends.

謝謝，卡拉，大家早上好。我還要感謝我們在 Reliance 的敬業團隊，感謝他們出色的運營執行力和對安全的持續承諾。我現在將談談我們第一季度的需求和定價趨勢。

Our tons sold increased 17.7% compared to the fourth quarter of 2022, surpassing our expectations of up 11% to 13% and vastly exceeding the typical seasonal recovery. Compared to the prior year period, our tons sold were up 7.2% higher than the service center industry increase of 5.5% as reported by the MSCI. The performance was supported by our organic growth activities we've invested in over the course of the past several years, along with our end market and product diversification, broad value-added processing capabilities and ability to service quick turnaround orders.

與 2022 年第四季度相比，我們的銷量增長了 17.7%，超出了我們 11% 至 13% 的預期，大大超過了典型的季節性複蘇。與去年同期相比，我們的銷售噸數增長了 7.2%，高於 MSCI 報告的服務中心行業增長 5.5%。我們在過去幾年中投資的有機增長活動，以及我們的終端市場和產品多元化、廣泛的增值加工能力以及為快速周轉訂單提供服務的能力都為業績提供了支持。

Continued strength in the nonresidential construction, general manufacturing and aerospace end markets further contributed to our strong shipment levels in the quarter. Additionally, rising metal cost trends incentivized many customers to reenter the market ahead of further price increases, which led to strengthened demand for our carbon steel flat-rolled products. Shipments for the other carbon steel products we sell also increased both sequentially and year-over-year. Our first quarter average selling price per ton sold of $2,623 declined 6.3% compared to the fourth quarter of 2022, exceeding our expected decrease of 3% to 5%, largely due to shifts in product mix.

非住宅建築、一般製造和航空航天終端市場的持續強勁進一步推動了我們本季度強勁的出貨量。此外，金屬成本上升的趨勢促使許多客戶在價格進一步上漲之前重新進入市場，這導致對我們的碳鋼扁材產品的需求增加。我們銷售的其他碳鋼產品的出貨量也環比和同比增長。我們第一季度的每噸平均售價為 2,623 美元，與 2022 年第四季度相比下降了 6.3%，超過了我們預期的 3% 至 5% 的降幅，這主要是由於產品結構的變化。

Relative to the fourth quarter, the increase in carbon steel product shipments, which have a lower average selling price than stainless steel and aluminum products contributed to a shift in our product mix, resulting in a lower realized sales price per ton sold. While our overall quarterly average selling price per ton sold decreased, pricing for most products we sell stabilized during the first quarter. It's also important to note that announced carbon steel flat-rolled price increases were only partially realized during the first quarter, with more to come in the second quarter. Arthur will cover our second quarter 2023 outlook in more detail.

與第四季度相比，平均售價低於不銹鋼和鋁產品的碳鋼產品出貨量增加導致我們的產品結構發生變化，導致每噸實際銷售價格降低。雖然我們每噸銷售的整體季度平均售價有所下降，但我們銷售的大多數產品的價格在第一季度保持穩定。同樣重要的是要注意，宣布的碳鋼扁材價格上漲在第一季度僅部分實現，第二季度將實現更多。 Arthur 將更詳細地介紹我們 2023 年第二季度的展望。

On a non-GAAP FIFO basis, which is how we monitor our day-to-day operating performance, our gross profit margin increased by 190 basis points to 30.5% compared to the prior quarter due to the -- due to better alignment of inventory cost on hand with replacement costs.

在非 GAAP FIFO 的基礎上，這是我們監控日常運營績效的方式，我們的毛利率比上一季度增加了 190 個基點，達到 30.5%，這是由於 - 由於庫存的更好調整手頭成本與重置成本。

I'll now turn to a high-level overview of the trends we saw within our key end markets. Notably, shipments improved both year-over-year and quarter-over-quarter in nearly every end market with continued strength in non-res construction, general manufacturing, auto through our tolling operations, aerospace and energy. While sales to the semiconductor industry declined sequentially and remained at elevated levels compared to the first quarter of 2022. And our long-term outlook for this market remains positive and we will continue to make investments to increase Reliance's capacity in the semiconductor space to support the significant expansion of semiconductor fabrication underway in the United States.

我現在將對我們在關鍵終端市場中看到的趨勢進行高層次的概述。值得注意的是，幾乎每個終端市場的出貨量同比和環比都有所改善，非資源建築、一般製造、汽車通過我們的收費業務、航空航天和能源持續強勁。雖然與 2022 年第一季度相比，半導體行業的銷售額環比下降並保持在較高水平。我們對該市場的長期前景仍然樂觀，我們將繼續投資以增加 Reliance 在半導體領域的產能，以支持美國正在進行的半導體製造的顯著擴張。

Separately, we will also continue to make investments in our businesses that sell into infrastructure and clean energy to support anticipated higher activity in these areas. Please refer to our earnings release for additional commentary on our end markets. Overall, we remain confident underlying demand will remain healthy across the majority of the end markets we serve in the second quarter of 2023.

另外，我們還將繼續投資我們的基礎設施和清潔能源銷售業務，以支持這些領域預期的更高活動。有關我們終端市場的更多評論，請參閱我們的收益發布。總體而言，我們仍然相信，到 2023 年第二季度，我們服務的大多數終端市場的潛在需求將保持健康。

I'll now turn the call over to Arthur to review our financial results and outlook.

我現在將電話轉給亞瑟，以審查我們的財務業績和前景。

Thanks, Steve. Good morning, everyone, and thank you for joining us today. As Karla highlighted, ongoing strong demand contributed to non-GAAP earnings per share of $6.37, well ahead of our guidance of $5.40 to $5.60 per share. The stronger-than-anticipated 17.7% sequential increase in our tons sold also exceeded our guidance and accounted for the majority of the earnings per share outperformance, while our overall quarterly average selling price per ton declined from the previous quarter due to the entry point into Q1 being lower than the prior quarter average and a shift in our product mix. Our selling prices remained relatively stable throughout the first quarter.

謝謝，史蒂夫。大家早上好，感謝您今天加入我們。正如 Karla 強調的那樣，持續強勁的需求促成了 6.37 美元的非 GAAP 每股收益，遠高於我們 5.40 美元至 5.60 美元的每股收益指引。我們的銷量環比增長 17.7%，強於預期，也超出了我們的指導，佔每股收益表現出色的大部分，而我們的整體季度平均每噸售價較上一季度有所下降，原因是進入第一季度低於上一季度的平均水平，我們的產品組合發生了變化。我們的售價在整個第一季度保持相對穩定。

In an environment of relatively flat pricing for the vast majority of the products we sell, we improved our transactional or FIFO gross profit margins that's without the impact of LIFO adjustments from the fourth quarter of 2022 as our inventory turn rate accelerated and costs on hand continued to better align with lower replacement costs. Additionally, we realized a significant amount of operating leverage on the incremental tons we shipped, these factors collectively contributed to the better-than-expected results for the first quarter.

在我們銷售的絕大多數產品定價相對平穩的環境中，隨著我們的庫存周轉率加快和手頭成本持續增加，我們提高了交易毛利率或 FIFO 毛利率，這不受 2022 年第四季度後進先出法調整的影響以更好地配合較低的更換成本。此外，我們意識到我們發貨的增量噸數有很大的經營槓桿，這些因素共同促成了第一季度好於預期的結果。

We recorded LIFO income of $15 million in the first quarter of 2023 and compared to $99.1 million of LIFO income in the fourth quarter of 2022 and LIFO expense $37.5 million in the first quarter of 2022. Our current estimate of $60 million of LIFO income for fiscal 2023 remains unchanged from our previous outlook. As a result, we currently expect to record $15 million of LIFO income in the second quarter of 2023.

我們在 2023 年第一季度錄得 LIFO 收入 1500 萬美元，而 2022 年第四季度的 LIFO 收入為 9910 萬美元，2022 年第一季度的 LIFO 費用為 3750 萬美元。我們目前估計 LIFO 收入為 6000 萬美元用於財政2023 年與我們之前的展望保持不變。因此，我們目前預計 2023 年第二季度後進先出法收入將達到 1500 萬美元。

Consistent with historical practice, we will update our expectations quarterly to account for actual inventory cost and metal pricing trends. As of March 31, 2023, the LIFO reserve on our balance sheet was about $729 million, which will generate LIFO income and benefit future period operating results to mitigate the impact of potential declines in metal prices.

與歷史慣例一致，我們將每季度更新一次預期，以考慮實際庫存成本和金屬定價趨勢。截至 2023 年 3 月 31 日，我們資產負債表上的 LIFO 儲備約為 7.29 億美元，這將產生 LIFO 收入並有利於未來期間的經營業績，以減輕金屬價格潛在下跌的影響。

Moving on to expenses. Our first quarter non-GAAP SG&A expenses increased $43.2 million or 7% compared to the fourth quarter of 2022. Due primarily to higher incentive compensation associated with higher profitability as well as higher variable warehousing and delivery expenses associated with higher tons shipped. On a year-over-year basis, non-GAAP SG&A expenses increased $43.3 million or 7.1% primarily due to incremental variable costs associated with higher tons shipped and inflationary wage adjustments, which were partially offset by lower incentive-based compensation resulting from lower FIFO profitability.

繼續討論費用。與 2022 年第四季度相比，我們第一季度的非 GAAP SG&A 費用增加了 4320 萬美元或 7%。這主要是由於更高的激勵薪酬與更高的盈利能力相關，以及更高的可變倉儲和交付費用與更高的運輸噸數相關。與去年同期相比，非 GAAP SG&A 費用增加了 4330 萬美元或 7.1%，這主要是由於與更高的運輸噸數和通貨膨脹工資調整相關的增量可變成本，這部分被較低的 FIFO 導致的基於激勵的薪酬減少所抵消盈利能力。

Turning to cash flow. Despite about $100 million of working capital investment in the first quarter, we generated cash flow from operations of $384.6 million, supported by our strong earnings. Our inventory turn rate based on tons improved in the first quarter of 2023 to 4.9x or 2.4 months on hand, up from 4.4x or 2.7 months on hand for all of 2022 and exceeding our company-wide turn goal of 4.7x. Our days sales outstanding was approximately 40 days in line with our historical range of 39 to 43 days. Our operating cash flow funded $102.9 million of record quarterly capital expenditures and the return of $100.9 million to our stockholders in the form of $62 million of cash dividends and $38.9 million of share repurchases. As of March 31, 2023, approximately $641.8 million remained available on our $1 billion share repurchase authorization.

轉向現金流。儘管第一季度的營運資本投資約為 1 億美元，但在強勁收益的支持下，我們從運營中產生了 3.846 億美元的現金流。 2023 年第一季度，我們基於噸的庫存周轉率從 2022 年全年的 4.4 倍或 2.7 個月提高到 4.9 倍或 2.4 個月，超過了我們全公司 4.7 倍的周轉率目標。我們的未償銷售天數約為 40 天，與我們 39 至 43 天的歷史範圍一致。我們的運營現金流為創紀錄的季度資本支出提供了 1.029 億美元資金，並以 6200 萬美元現金股息和 3890 萬美元股票回購的形式向股東返還了 1.009 億美元。截至 2023 年 3 月 31 日，我們的 10 億美元股票回購授權仍有約 6.418 億美元可用。

I'll now turn to our second quarter outlook. While we expect underlying demand will remain healthy in the second quarter of 2023, we expect our tons sold will be flat to down 2% in the second quarter of 2023 compared to the first quarter of 2023 due to one less shipping day in the second quarter of '23 and the absence of the demand pull forward experienced in the first quarter of 2023. We anticipate overall pricing to remain fairly stable with slight upside from recently announced carbon steel price increases. Accordingly, we estimate our average selling price per ton sold in the second quarter of 2023 will be flat to up 2% compared to the first quarter of 2023. Based on these expectations, we anticipate non-GAAP earnings per diluted share in the range of $6.40 to $6.60 for the second quarter of 2023.

我現在轉向我們的第二季度展望。雖然我們預計 2023 年第二季度的基本需求將保持健康，但我們預計 2023 年第二季度的銷量將比 2023 年第一季度持平或下降 2%，原因是第二季度的運輸日減少了一個23 年以及 2023 年第一季度沒有需求拉動。我們預計整體價格將保持相當穩定，最近宣布的碳鋼價格上漲將略有上漲。因此，我們估計我們在 2023 年第二季度銷售的每噸平均售價與 2023 年第一季度相比將持平至上漲 2%。基於這些預期，我們預計非 GAAP 每股攤薄收益將在2023 年第二季度為 6.40 美元至 6.60 美元。

In closing, we are very pleased with our solid start to the year with strong shipment levels, earnings and cash flow despite continued macroeconomic uncertainty. This concludes our prepared remarks. Thank you for your attention. And at this time, we'd like to open the call up to questions. Operator?

最後，我們對今年的良好開局感到非常高興，儘管宏觀經濟持續存在不確定性，但出貨量、收益和現金流仍然強勁。我們準備好的發言到此結束。感謝您的關注。此時，我們想公開提問。操作員？

Thank you. We will now be conducting a question-and-answer session. (Operator Instructions) Our first question comes from Emily Chieng with GoldmanSachs.

謝謝。我們現在將進行問答環節。 （操作員說明）我們的第一個問題來自高盛的 Emily Chieng。

I wanted to ask around the shipment levels in 1Q and then the outlook for 2Q. So I know you mentioned that there was some demand pull forward in the first quarter. Perhaps could you give us a sense as to if there wasn't this pull forward, what would shipments have been? And then as you look into the second quarter, if there's no demand pull forward there, are you getting a sense that there's a sign -- there's any indications of perhaps demand being pushed out given the macro uncertainty?

我想問一下第一季度的出貨水平，然後是第二季度的前景。所以我知道你提到第一季度有一些需求拉動。也許你能告訴我們如果沒有這種推動力，出貨量會是多少？然後當你回顧第二季度時，如果那裡沒有需求拉動，你是否感覺到有跡象——有任何跡象表明，鑑於宏觀不確定性，需求可能被推遲？

Hi Emily, thanks for joining the call today. So on the demand side, we were very pleasantly surprised a bit with the strength of the demand pull forward. And -- or sorry, of our shipments during the first quarter, it was higher than our typical seasonality bounce back. Part of that, we mentioned that related to some of our organic growth activities. So we had a couple of our newer plants that are on campus with some of our good mill partners. And with their ramp-ups, we also benefited from more shipments out of those locations that contributed.

嗨，艾米麗，感謝您今天加入電話會議。因此，在需求方面，我們對需求拉動的力量感到非常驚喜。而且 - 或者抱歉，我們第一季度的出貨量高於我們典型的季節性反彈。其中一部分，我們提到與我們的一些有機增長活動有關。因此，我們與一些優秀的工廠合作夥伴在園區內建立了幾個較新的工廠。隨著他們的增加，我們也受益於來自那些做出貢獻的地點的更多出貨量。

But even without that and the pull forward we had guided to a slightly stronger-than-normal seasonal bounce back and really because our customers continue to be busy they're still struggling to find the labor they need, which extends some of the strength in their businesses for continued shipments. So we're pleased with what we see. Q2 guidance, really, we've got 1 less shipping day that's the majority of the guide. We're typically -- our Q1 and Q2 are generally pretty flat historically, and we had good, strong shipments in Q1. And we're looking for something similar to that in Q2, minus the 1 day and a little bit of demand pull forward we had with the dynamics on the carbon steel flat-rolled pricing in the quarter.

但即使沒有這一點和推動力，我們也引導了比正常情況略強的季節性反彈，真的因為我們的客戶繼續忙碌，他們仍在努力尋找他們需要的勞動力，這擴大了一些力量他們的業務以繼續發貨。所以我們對我們所看到的很滿意。 Q2 指南，真的，我們少了 1 個發貨日，這是指南的大部分內容。我們通常 - 從歷史上看，我們的第一季度和第二季度總體上是持平的，而且我們在第一季度的出貨量很好，很強勁。我們正在尋找與第二季度類似的東西，減去 1 天和我們在本季度碳鋼平軋定價動態方面的一點點需求。

Great. That's very clear. A second question just around the end markets then. Has there been anything that has been impacted by some of the credit tightening that we're seeing? And have there been any signs of project delays or cancellations? It's been good to see some inflow from the infrastructure side, but curious if there's anything that you're seeing a little weakness there?

偉大的。這很清楚。那麼第二個問題就圍繞終端市場。我們看到的一些信貸緊縮是否影響了任何事情？是否有任何項目延遲或取消的跡象？很高興看到基礎設施方面有一些資金流入，但很好奇您是否看到那裡有什麼弱點？

Yes. So we certainly understand that people have concerns and there's speculation that we're seeing that. We haven't seen it yet. We're not saying that we might not see some of it later in the year. But going into Q2, our customers have strong backlogs and projects are continuing.

是的。因此，我們當然理解人們的擔憂，並且有人猜測我們正在看到這種擔憂。我們還沒有看到它。我們並不是說我們可能不會在今年晚些時候看到其中的一些。但進入第二季度，我們的客戶積壓了大量訂單，項目仍在繼續。

Next question comes from Timna Tanners with Wolfe Research.

下一個問題來自 Wolfe Research 的 Timna Tanners。

I wanted to ask to follow-up Emily's question, we've heard from some of the smaller service centers that they're struggling with higher interest rates. So could you be perhaps gaining share if some of your competitors are having a harder time accessing capital. And because it doesn't sound like that's an issue for you. So just wondering about that competitive dynamic.

我想問一下 Emily 的問題，我們從一些較小的服務中心聽說他們正在努力應對更高的利率。如果您的一些競爭對手難以獲得資金，那麼您能否獲得份額。而且因為這聽起來對您來說不是問題。所以只是想知道那種競爭動態。

Yes, Timna. So we are not aware of that. We have heard some comments by people that some of the service centers may be struggling. For us, that is an environment where it is typically favorable for us and where our customers still seem healthy as well. But if they're trying to manage their credit limits more tightly, that's usually favorable for us because of our smaller -- we're able to service smaller order sizes on a frequent basis. So it does create a favorable environment for us, and we do pick up some market share sometimes in those types of environments.

是的，蒂姆納。所以我們對此一無所知。我們聽到一些人的評論，有些服務中心可能正在苦苦掙扎。對我們來說，這是一個通常對我們有利的環境，我們的客戶看起來也仍然健康。但是，如果他們試圖更嚴格地管理他們的信用額度，那通常對我們有利，因為我們的規模較小——我們能夠經常為較小的訂單規模提供服務。所以它確實為我們創造了一個有利的環境，有時我們確實在這些類型的環境中獲得了一些市場份額。

Okay. That's helpful. Alongside your mix, you mentioned the higher sheet prices. There's also been some big plate increases. I know you're decent in plate. But on the flip side, for long products on the carbon side, with scrap retreating a bit here, that could be an offset. I mean, is there anything I'm missing in terms of the moving parts because of flat to up 2% pricing number seems to temper some of that enthusiasm we've seen on the flat-rolled side. So any other color on the components of that pricing guidance would be great.

好的。這很有幫助。除了你的組合，你還提到了更高的紙張價格。也有一些大板塊增加。我知道你在盤子裡很體面。但另一方面，對於碳方面的長材產品，廢鋼在這里略有回落，這可能是一種抵消。我的意思是，由於定價數字持平到上漲 2%，我在活動部件方面是否遺漏了什麼似乎緩和了我們在平軋方面看到的一些熱情。因此，該定價指南的組成部分上的任何其他顏色都很好。

Timna, it's Steve. I'd have to say there's not really much to report there. Our long product business has been steady. Prices have been steady. Demand has been strong, and we've not seen a pullback in demand or pricing.

蒂姆娜，是史蒂夫。我不得不說那裡沒有什麼可報告的。我們的長材業務一直穩定。價格一直穩定。需求一直很強勁，我們沒有看到需求或定價出現回落。

Yes. And our mix too, Timna, can also impact that. Semiconductor, we're seeing a little weakness there right now. And our pricing on those products is pretty high compared to a lot of the other products, including like carbon flat rolled or plate. And so the product mix can make a bit of a difference as well.

是的。我們的組合 Timna 也可以影響這一點。半導體，我們現在看到了一些弱點。與許多其他產品相比，我們對這些產品的定價相當高，包括碳扁軋或板材。因此，產品組合也會有所不同。

So that would be offsetting some of the sharp increases in flat rolled second quarter over first quarter is what you're saying?

所以這將抵消第二季度與第一季度相比的一些急劇增長是你的意思嗎？

Yes. Well, we saw some of it in the first quarter and would expect that to continue in the second quarter, yes.

是的。好吧，我們在第一季度看到了其中的一些，並且預計第二季度會繼續，是的。

Okay. And then for my final question, and I'll take a stab at LIFO here. I was kind of surprised with the lack of change in the $60 million annual guidance. Given the stronger price environment, at least of late. Can you walk us through -- I mean, is that really a function of year-over-year lower prices? Does that reflect any thoughts on inventory year-over-year? If you could just talk us through why that didn't change despite some of the more positive dynamics you've laid out? And -- because I would have expected that could have converted to a LIFO expense.

好的。然後是我的最後一個問題，我會在這裡試一試後進先出法。我對 6000 萬美元的年度指導沒有變化感到有點驚訝。鑑於更強勁的價格環境，至少最近是這樣。你能告訴我們——我的意思是，這真的是價格同比下降的結果嗎？這是否反映了對庫存同比的任何想法？如果你能告訴我們為什麼儘管你已經提出了一些更積極的動態，但情況沒有改變？而且——因為我本以為這可能會轉化為後進先出的費用。

Yes. Sure, Timna, this is Arthur. So from our perspective, I mean, you have to look at our product mix as well. Karla just alluded to that earlier, carbon flat rolled combined as a percentage of sales in the first quarter, less than 20%. And you have certainly some prices on the carbon side, plate and flat rolled, that have come up, but there's some headwinds on the non-ferrous side.

是的。當然，蒂姆娜，這是亞瑟。所以從我們的角度來看，我的意思是，你也必須看看我們的產品組合。 Karla 剛才提到，第一季度碳素軋製合計佔銷售額的百分比不到 20%。當然，碳方面、中厚板和平軋方面的一些價格已經上漲，但有色金屬方面存在一些不利因素。

So all in all, there wasn't anything sort of story changing, so to speak, from an annual cost forecast perspective. And also when you step back and you look at a $60 million LIFO on nearly $3 billion worth of inventories and that's FIFO basis, it's a relatively small number. So essentially, what we're saying is kind of relatively flat pricing, right, for the year. At least for cost on hand from the beginning of the year to the end of the year.

所以總而言之，從年度成本預測的角度來看，可以說沒有任何故事發生變化。而且當你退後一步，你會看到價值近 30 億美元的庫存中有 6000 萬美元的後進先出法，這是 FIFO 的基礎，這是一個相對較小的數字。所以從本質上講，我們所說的是今年相對平穩的定價。至少從年初到年末的手頭成本。

(Operator Instructions) Our next question comes from Phil Gibbs, KeyBanc Capital Markets.

（操作員說明）我們的下一個問題來自 KeyBanc Capital Markets 的 Phil Gibbs。

Can you guys hear me okay?

你們能聽到我說話嗎？

Yes.

是的。

All right. Perfect. Some pretty strong comments on aerospace in the release. Maybe give us some color in terms of what you all are thinking for the balance of the year because the rebound in Q1 sounded very strong.

好的。完美的。新聞稿中對航空航天有一些非常強烈的評論。也許就你們對今年餘下時間的想法給我們一些顏色，因為第一季度的反彈聽起來非常強勁。

Phil, so we've been seeing continued improvement in our aerospace business throughout 2022 and then coming into the first quarter of this year. Commercial aerospace build rates have been improving. And so we've benefited from that. That's probably -- commercial is probably about half of our aerospace exposure and then space, private jet, defense have continued at strong levels. So overall, we've been really pleased with what we've seen and our customers continue to be busy and we expect that to continue throughout the year.

菲爾，所以我們一直看到我們的航空航天業務在整個 2022 年持續改善，然後進入今年第一季度。商業航空建造率一直在提高。所以我們從中受益。這可能是——商業可能占我們航空航天風險的一半左右，然後太空、私人飛機、國防繼續保持強勁水平。總的來說，我們對所看到的情況感到非常滿意，我們的客戶仍然很忙，我們預計這一年將持續下去。

And then I may have missed it because I did miss a portion of the script, but your CapEx expectations for the year on a cash basis. I think Q1, you did a little over $100 million, but what's the expectation for the full year there?

然後我可能錯過了它，因為我確實錯過了劇本的一部分，但你對今年資本支出的預期是以現金為基礎的。我認為 Q1，你做了 1 億美元多一點，但全年的預期是什麼？

Yes, Phil. So we do still have some catch-up from our spend over the last year or 2 because of extended lead times and a lot of the equipment manufacturers and just constructing new buildings and things. So we estimate that we'll spend cash of about $400 million to $450 million in 2023. We did have $100 million, as you mentioned, spend in the first quarter. We are seeing some of those lead times start to come in a little bit. So we're anticipating some improvement in that area as we progress through the year.

是的，菲爾。因此，由於交貨時間延長和許多設備製造商以及建造新建築物和東西，我們在過去一兩年的支出中確實有一些追趕。因此，我們估計到 2023 年我們將花費大約 4 億至 4.5 億美元的現金。正如你提到的，我們在第一季度確實有 1 億美元的支出。我們看到其中一些交貨時間開始縮短。因此，我們預計隨著這一年的進展，該領域會有所改善。

And then just lastly, I know Timna asked the question on share gains. I think you did intimate that there were some of that in your first quarter in your release. Maybe talk a little bit about that more. And if it's something that could be meaningful to you all this year in the sense that, hey, is it a couple hundred basis points? Is it more than that? Is it less than that? Anything that you could provide there would be helpful.

最後，我知道 Timna 問了關於股票收益的問題。我認為您確實暗示在您發布的第一季度中有一些這樣的內容。也許再談一點。如果這對你今年有意義，嘿，它是幾百個基點嗎？不止於此嗎？是不是比那個少？您可以提供的任何東西都會有所幫助。

Yes. So we mentioned that we -- we do have a couple of new facilities, some of our organic growth that have been ramping. And so we're seeing some higher shipments based on that activity. Our tons shipped were higher than the MSCI industry average. So that would imply that we are taking a little share. We've got great people out there throughout our organization who are hungry and they like to sell metal. And we're -- we may be taking some share. We don't have a specific plan. We haven't quantified anything, but we've got the capability to ship more tons if we get reasonable profits on it.

是的。所以我們提到我們 - 我們確實有幾個新設施，我們的一些有機增長一直在加速。因此，我們看到基於該活動的出貨量有所增加。我們的出貨噸數高於 MSCI 行業平均水平。因此，這意味著我們正在分一杯羹。我們整個組織都有優秀的人才，他們渴望銷售金屬。我們 - 我們可能會分享一些。我們沒有具體的計劃。我們沒有量化任何東西，但如果我們從中獲得合理的利潤，我們有能力運送更多噸。

Next question comes from Martin Englert, Seaport Research.

下一個問題來自 Seaport Research 的 Martin Englert。

I wanted to get your thoughts on -- you spoke about underlying demand looking into 2Q here. But looking past that, do you have any thoughts or expectations in the back half of the year and maybe how that compares to the prior year. Any color, commentary maybe from some of the customer base on their expectations or their budgets?

我想听聽你的想法——你在這裡談到了第二季度的潛在需求。但回顧過去，您對今年下半年有什麼想法或期望嗎？也許與去年相比如何？任何顏色，評論可能來自某些客戶群，基於他們的期望或預算？

Martin, our customers, I don't know if we look that far out, 40% of our orders, the customer calls today, we ship tomorrow. The sentiment from our customers are that they continue to be busy. They're not getting as much labor, that their workforces are down a bit. So they still have orders that they're working to fulfill.

馬丁，我們的客戶，我不知道我們是否看得那麼遠，我們 40% 的訂單，客戶今天打電話，我們明天發貨。我們客戶的情緒是他們繼續忙碌。他們沒有得到那麼多的勞動力，他們的勞動力有所下降。所以他們仍然有他們正在努力完成的訂單。

Beyond Q2, we're not sure. There are a lot of uncertainties out there. We do think, though, and we mentioned in our comments, you've got the combination of reshoring of some manufacturing business. You've got the Infrastructure Bill, which sounds like a lot of the mills are starting to see some activity from that we typically trail the mills a bit. So we think that's a positive indicator for us, along with activity on the Inflation Reduction Act and the CHIPS Act. We're expanding some of our capacity to be able to meet that demand as we just commented, aerospace has been strong. Our toll processing for the automotive business has been strong. So no quantified outlook for the second half, but we feel good about 2023.

在第二季度之後，我們不確定。那裡有很多不確定性。不過，我們確實認為，並且我們在評論中提到，您已經結合了一些製造業務的回流。你有基礎設施法案，聽起來很多工廠開始看到一些活動，我們通常會稍微落後於工廠。因此，我們認為這對我們來說是一個積極的指標，以及《降低通貨膨脹法案》和《籌碼法案》的活動。正如我們剛剛評論的那樣，我們正在擴大我們的一些能力以滿足這種需求，航空航天一直很強勁。我們對汽車業務的收費處理一直很強勁。因此，下半年沒有量化前景，但我們對 2023 年感覺良好。

Okay. And I guess kind of along the same lines and you did touch on that sort of there was maybe some pull forward as buyers stepped up the sidelines in 1Q here. But any other color on how buying activity among the customer base when you think across different metals, products is today versus how it transpired in 1Q? And are there any differences or divergent trends when you think about that activity, carbon versus other metals?

好的。而且我想有點沿著同樣的路線，你確實觸及了那種可能有一些推動，因為買家在第一季度加強了觀望。但是，當您考慮不同的金屬、產品時，客戶群的購買活動與第一季度的情況相比，還有其他顏色嗎？當您考慮碳與其他金屬的活動時，是否存在任何差異或不同趨勢？

Yes. So Martin, there was the pricing dynamic for carbon flat rolled during Q1 with the price increases. There were quite a few increases. They're pretty significant. As mentioned, there have been some plate increases. So we think some customers may have bought ahead a bit. So we commented on that as a factor in Q1. But it seems like prices are stabilizing a bit now, and we expect kind of normal buying patterns in the second quarter.

是的。所以馬丁，隨著價格上漲，第一季度碳平板軋製的定價動態。有相當多的增長。它們非常重要。如前所述，板塊有所增加。所以我們認為一些客戶可能已經提前購買了一點。因此，我們將其作為第一季度的一個因素進行了評論。但現在價格似乎有點穩定，我們預計第二季度會出現一種正常的購買模式。

Any indication that this would pivot from the restock to a destock across the supply chain? Or rather, I guess, what you're saying -- in my read on what you're explaining is not necessarily that it's more so, yes, there was some prebuying and maybe some restocking, but now just kind of stabilized. Is that right?

有任何跡象表明這將在整個供應鏈中從補貨轉向去庫存嗎？或者更確切地說，我猜，你在說什麼——在我對你所解釋的內容的閱讀中，不一定是這樣，是的，有一些預先購買，也許有一些補貨，但現在有點穩定了。是對的嗎？

Yes. I mean, Martin, we don't really -- we don't run our business to restock or destock. We run our business to focus on our customers needs. And as I mentioned a few minutes ago, a lot of our business is next-day type delivery. So and our inventories are in very good shape. And we think throughout the industry inventories are in pretty good shape. So we don't anticipate any big changes in buying patterns as we move into the next quarter for us or for our customers or competitors.

是的。我的意思是，馬丁，我們不是真的——我們的業務不是為了補充庫存或去庫存。我們經營我們的業務以關注客戶的需求。正如我幾分鐘前提到的，我們的很多業務都是次日送達。因此，我們的庫存狀況非常好。我們認為整個行業的庫存狀況都很好。因此，我們預計在進入下一季度時，我們或我們的客戶或競爭對手的購買模式不會發生任何重大變化。

If I could, one more. Any additional color on the semiconductor weakness, mix shift there?

如果可以，再來一個。半導體弱點有什麼額外的顏色，有混合轉移嗎？

Yes. I think we're seeing a bit. Shipments are still at strong levels, we're still higher than year-ago levels. The industry had been at record levels, and there's been a little bit of a pullback. We think there was maybe a little bit of a glut. Some customers maybe had more inventory than they needed for the slowdown that has been seen. And that's really for us related to selling metal into the equipment manufacturers feeding into the semiconductor industry.

是的。我想我們看到了一些。出貨量仍處於強勁水平，我們仍高於去年同期水平。該行業一直處於創紀錄的水平，並且出現了一些回落。我們認為可能有點供過於求。一些客戶的庫存可能比他們所看到的放緩所需要的更多。這對我們來說真的與向半導體行業的設備製造商銷售金屬有關。

From a semiconductor kind of infrastructure, so to speak, which is the other part of our semiconductor business with all the spending that's been announced in the U.S. We see that business continuing to be steady to stronger. So we think it's just a temporary situation long term, both from the expansion of the chip making capabilities in the U.S. and just the demand for chips, we think is going to be very strong on a long-term basis.

從半導體類型的基礎設施來看，可以說，這是我們半導體業務的另一部分，在美國已經宣布了所有支出。我們看到該業務繼續穩定到更強大。所以我們認為這只是長期的暫時情況，無論是從美國芯片製造能力的擴張還是對芯片的需求來看，我們認為從長期來看都會非常強勁。

Since there are no further questions, I would like to turn the floor back over to Karla Lewis for closing comments.

由於沒有其他問題，我想將發言權轉回給 Karla Lewis 以發表結束評論。

Thank you. And thanks again to all of you for your time and attention today. Before we close out the call, I'd like to remind everyone that we'll be in Boston in late May, attending the KeyBanc Industrials and Basic Materials Conference. And in Chicago in mid-June, presenting at the Wells Fargo Industrials Conference. We hope to see many of you there. And thank you again to our team at Reliance for your continued strong performance so far in 2023. And thank you to all of you for your continued support of and commitment to Reliance. Thank you.

謝謝。再次感謝大家今天的時間和關注。在我們結束電話會議之前，我想提醒大家，我們將於 5 月下旬在波士頓參加 KeyBanc 工業和基礎材料會議。 6 月中旬在芝加哥，在富國銀行工業會議上發表演講。我們希望在那裡見到你們中的許多人。再次感謝我們的 Reliance 團隊在 2023 年迄今為止的持續強勁表現。感謝大家對 Reliance 的持續支持和承諾。謝謝。

This concludes today's teleconference. You may disconnect your lines at this time. Thank you for your participation, and have a great day.

今天的電話會議到此結束。此時您可以斷開線路。感謝您的參與，祝您有美好的一天。