Reliance Inc (RS) 2024 Q1 法說會逐字稿

Greetings, and welcome to Reliance Inc. First Quarter 2024 Earnings Conference Call. (Operator Instructions) As a reminder, this conference is being recorded.

您好，歡迎參加 Reliance Inc. 2024 年第一季財報電話會議。 （操作員指示）謹此提醒，本次會議正在錄製中。

It is now my pleasure to introduce your host, Kim Orlando with Addo Investor Relations. Thank you, Ms. Orlando. You may begin.

現在我很高興向您介紹主持人，阿多投資者關係部的金·奧蘭多 (Kim Orlando)。謝謝你，奧蘭多女士。你可以開始了。

Thank you, operator. Good morning, and thanks to all of you for joining our conference call to discuss Reliance's first quarter 2024 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.reliance.com.

謝謝你，接線生。早安，感謝大家參加我們的電話會議，討論 Reliance 2024 年第一季的財務表現。總裁兼執行長卡拉·劉易斯 (Karla Lewis) 也加入了我的行列； Steve Koch，執行副總裁兼營運長；以及資深副總裁兼財務長 Arthur Ajemyan。本次電話會議的錄音將發佈在我們網站 Investor.reliance.com 的投資者部分。

Please read the forward-looking statement disclosures included in our earnings release issued this morning, and note that it applies to all statements made during this teleconference. The reconciliations of the adjusted numbers are included in the non-GAAP reconciliation part of our earnings release. I will now turn the call over to Karla Lewis, President and CEO of Reliance.

請閱讀我們今天早上發布的收益報告中包含的前瞻性聲明披露內容，並注意它適用於本次電話會議期間發表的所有聲明。調整後數字的調節包含在我們收益發布的非公認會計準則調節部分。我現在將把電話轉給 Reliance 總裁兼執行長 Karla Lewis。

Good morning, everyone, and thank you all for joining us today to discuss our first quarter 2024 results. Our resilient business model, most notably the diversity of our products, end markets and geography once again delivered strong performance in the first quarter. Despite a challenging pricing environment, we continue to drive smart profitable growth surpassing broader industry shipment levels and maintain pricing discipline and a strong gross profit margin, all of which collectively contributed to our first quarter non-GAAP earnings per diluted share of $5.30.

大家早安，感謝大家今天加入我們討論我們 2024 年第一季的業績。我們富有彈性的業務模式，尤其是我們產品、終端市場和地理位置的多樣性，在第一季再次帶來了強勁的業績。儘管定價環境充滿挑戰，我們仍繼續推動盈利增長，超越更廣泛的行業出貨水平，並保持定價紀律和強勁的毛利率，所有這些共同為我們第一季非公認會計原則攤薄每股收益5.30美元做出了貢獻。

Our significant investments in value-added processing capabilities continue to bolster our gross profit margin throughout market cycles. Our profitable operations and consistent ability to generate cash enable us to continue allocating capital across our core priorities. We have completed 3 acquisitions to date in 2024, expanding our product offerings, processing capabilities and geographic reach and collectively adding nearly $500 million in annualized sales based on 2023 results.

我們對增值處理能力的重大投資繼續提高我們在整個市場週期的毛利率。我們的獲利營運和持續產生現金的能力使我們能夠繼續在我們的核心優先事項上分配資本。迄今為止，我們在 2024 年已完成 3 項收購，擴大了我們的產品供應、加工能力和地理覆蓋範圍，根據 2023 年的業績，年銷售額總計增加了近 5 億美元。

We also invested $108.7 million back into our business through capital expenditures, predominantly targeted towards growth opportunities that increase capacity and value-added processing capabilities. Our CapEx budget for the calendar year 2024 is $440 million, with an expected total cash outlay of approximately $500 million which includes certain carryover projects from prior years.

我們也透過資本支出向我們的業務投資了 1.087 億美元，主要針對提高產能和增值處理能力的成長機會。我們 2024 年的資本支出預算為 4.4 億美元，預計現金支出總額約為 5 億美元，其中包括前幾年的某些結轉項目。

As previously noted, we expect approximately 2/3 of our CapEx spend will be used for growth projects. We also returned $65.3 million to our valued stockholders in dividends. On the M&A side, in addition to acquiring Cooksey Steel on February 1, we completed 2 acquisitions earlier this month, American Alloy and Mid-West Materials. American Alloy brings specialty carbon steel plate to our product portfolio as well as new fabrication capabilities through the addition of 6 service center locations in the U.S.

如前所述，我們預計大約 2/3 的資本支出將用於成長項目。我們也向尊貴的股東返還了 6,530 萬美元的股息。併購方面，除了2月1日收購Cooksey Steel外，本月初我們還完成了兩項收購，分別是American Alloy和Mid-West Materials。 American Alloy 透過在美國增設 6 個服務中心，為我們的產品組合帶來了特殊碳鋼板以及新的製造能力。

Mid-West Materials increases our flat-rolled presence in and around Ohio primarily servicing North American OEMs. All of these transactions fit our acquisition strategy of acquiring immediately accretive, well-run companies with strong management teams. We have now completed 75 acquisitions since our 1994 IPO, and the M&A pipeline remains strong as we continue to evaluate a wide array of potential future opportunities.

中西部材料公司增加了我們在俄亥俄州及其周邊地區的平軋業務，主要為北美原始設備製造商提供服務。所有這些交易都符合我們的收購策略，即收購具有強大管理團隊、快速增值、營運良好的公司。自 1994 年 IPO 以來，我們現已完成 75 項收購，隨著我們繼續評估各種潛在的未來機會，併購管道仍然強勁。

And please note that our first quarter results include contributions from Cooksey that was acquired on February 1, but do not include American Alloy or Mid-West materials, both of which closed on April 1. Before I close, I'd like to thank the entire Reliance team for a strong start to the year through their commitment to exceptional customer service, marked profitable growth and most importantly, their commitment to safety. In the medium to long term, we believe the investments we have made and continue to make in our business position Reliance to benefit from growth opportunities under the Infrastructure Bill, the CHIPS Act and the Inflation Reduction Act, along with the robust reshoring and nearshoring activity currently underway in several of the end markets we service.

請注意，我們第一季的業績包括2 月1 日收購的Cooksey 的貢獻，但不包括美國合金公司或中西部材料公司，這兩家公司均於4 月1 日結束。感謝Reliance 整個團隊致力於提供卓越的客戶服務、顯著的利潤成長以及最重要的是對安全的承諾，為今年帶來了良好的開局。從中長期來看，我們相信我們已經並將繼續進行的投資將有助於我們的業務地位，並依賴從基礎設施法案、CHIPS 法案和通貨膨脹削減法案規定的增長機會以及強勁的回流和近岸活動中受益目前正在我們服務的幾個終端市場進行。

Thank you all for your time today. I'll now turn the call over to Steve, who will review our first quarter demand and pricing trends.

感謝大家今天抽出時間。我現在將把電話轉給史蒂夫，他將回顧我們第一季的需求和定價趨勢。

Thanks, Karla, and good morning, everyone. I'd also like to express my gratitude to our strong team at Reliance for a great start to the year and the continued commitment to safety. Further, I'd like to extend a warm welcome to the Reliance family of companies, the teams at Cooksey, American Alloy and Mid-West materials. I'll now turn to our first quarter demand and pricing trends.

謝謝卡拉，大家早安。我還要對 Reliance 強大的團隊表示感謝，感謝他們在今年取得了良好的開局，並持續致力於安全。此外，我還要熱烈歡迎 Reliance 公司大家庭、Cooksey、American Alloy 和 Mid-West Materials 的團隊。現在我將談談第一季的需求和定價趨勢。

Our tons sold increased 10.3% compared to the fourth quarter of 2023, in line with both our expectations of up 9% to 11% and typical seasonal trends. Compared to the prior year quarter, our tons sold were down 1.7%, but still well below the service center industry decrease of 4.2% as reported by the MSCI. We believe our continued outperformance of our MSCI peers is supported by both organic growth and strategic acquisitions.

與 2023 年第四季相比，我們的銷量成長了 10.3%，符合我們成長 9% 至 11% 的預期以及典型的季節性趨勢。與去年同期相比，我們的銷售量下降了 1.7%，但仍遠低於 MSCI 報告的服務中心產業 4.2% 的降幅。我們相信，我們持續領先 MSCI 同行的表現得益於有機成長和策略收購。

First quarter 2024 volumes were also impacted by 1 less shipping day in the first quarter of 2023. Our first quarter average selling price per ton sold at $2,442 declined by 1% compared to the fourth quarter of 2023 below our expectations of up 1% to 3%. We experienced lower-than-anticipated pricing across carbon and stainless steel products as the quarter progressed. Pressure on carbon steel product pricing contributed to a temporary decline in shipment activity during March as some customers delayed orders in anticipation of lower prices.

2024 年第一季的銷售量也受到2023 年第一季運輸日減少1 個的影響。於我們上漲1% 至3% 的預期%。隨著本季的進展，我們的碳鋼和不銹鋼產品定價低於預期。碳鋼產品定價面臨壓力，導致 3 月出貨活動暫時下降，部分顧客因預期價格下跌而延後訂單。

While carbon steel prices increased 1% compared to the fourth quarter, they nonetheless and in the second quarter trending down. Stainless steel prices were down 6.2% compared to the fourth quarter but stabilized heading into the second quarter. Next, I will turn to an overview of trends we saw within our products in key end markets. Carbon steel tubing, plate and structurals represented about 1/3 of our first quarter sales. All these products experienced solid volume growth and outperformed industry shipment levels compared to the first quarter of 2023.

儘管碳鋼價格較第四季上漲 1%，但在第二季仍呈下降趨勢。不鏽鋼價格較第四季下降 6.2%，但進入第二季趨於穩定。接下來，我將概述我們在主要終端市場的產品中看到的趨勢。碳鋼管材、板材和結構件約占我們第一季銷售額的 1/3。與 2023 年第一季相比，所有這些產品的銷量都實現了穩健成長，並且優於行業出貨量水準。

During the first quarter of 2024, strong nonresidential construction activity supported healthy demand for carbon steel structural and tubing products with plate demand softening due to declining prices. Aluminum stainless products represented just over 30% of our first quarter sales. While stainless shows more favorable volume trends than aluminum, we outperformed industry shipment levels across both product groups year-over-year.

2024 年第一季度，強勁的非住宅建築活動支撐了對碳鋼結構和管材產品的健康需求，但由於價格下跌，板材需求疲軟。鋁不銹鋼產品占我們第一季銷售額的 30% 多一點。雖然不銹鋼的銷售趨勢比鋁更有利，但我們兩個產品組的出貨量比同比均優於同業。

Aerospace products comprise about 9% of our total sales and aerospace demand remained stable year-over-year. We primarily service the automotive market through our toll processing operations which are not reflected in our tons sold. Our tolling business processed 4.8% more tons in the first quarter of 2024 than in the prior year, fueled by continuing strong demand from the automotive market and our significant investments to increase capacity.

航空航太產品約占我們總銷售額的9%，航空航太需求較去年同期維持穩定。我們主要透過來料加工業務為汽車市場提供服務，但這並未反映在我們的銷售中。在汽車市場持續強勁的需求以及我們為提高產能而進行的重大投資的推動下，我們的來料加工業務在 2024 年第一季的處理量比上年增加了 4.8%。

Our general manufacturing market business, which is roughly 1/3 of our total sales is highly diversified across products and includes industrial machinery, consumer products, heavy equipment and military. Shipments declined year-over-year driven by weakness in Agricultural Equipment and Consumer Products, partially offset by stronger industrial machinery shipments supported by military manufacturing demand. Demand in the semiconductor industry has stabilized, but remained down year-over-year. Our long-term outlook for the semiconductor market remains positive, reinforced by the CHIPS Act and significant semiconductor fabrication expansion underway in the United States, and we continue to invest in semiconductor capacity.

我們的一般製造市場業務約佔總銷售額的 1/3，產品高度多元化，包括工業機械、消費品、重型設備和軍事。由於農業設備和消費品疲軟，出貨量較去年同期下降，但部分被軍事製造需求支撐的工業機械出貨量走強所抵消。半導體產業的需求已經穩定，但同比仍然下降。我們對半導體市場的長期前景仍然樂觀，《CHIPS 法案》和美國正在進行的重大半導體製造擴張強化了這一前景，並且我們將繼續投資於半導體產能。

Overall, we see demand across the end markets we serve remaining stable to strong in the second quarter of 2024. Please refer to our earnings release for additional commentary on our end markets and product diversification. I will now turn the call over to Arthur to review our financial results and outlook.

總體而言，我們認為我們服務的終端市場的需求在 2024 年第二季度保持穩定至強勁。我現在將把電話轉給亞瑟，以審查我們的財務業績和前景。

Thanks, Steve, and good morning, everyone. Our first quarter 2024 non-GAAP diluted earnings per share of $5.30 were at the low end of our guided range as our tons sold seasonally improved, but pricing softened more than we anticipated. We successfully outperformed industry shipment levels across nearly all products, which bolstered our quarterly earnings despite the challenging pricing environment. Our 31% gross profit margin for the first quarter was attributable in part to higher-than-anticipated LIFO, benefit, better alignment of costs on hand and replacement costs and gross profit margin stability from our value-added processing capabilities.

謝謝史蒂夫，大家早安。我們的 2024 年第一季非 GAAP 攤薄每股收益為 5.30 美元，處於我們指引範圍的低端，因為我們的銷售季節性有所改善，但定價軟化程度超出了我們的預期。我們幾乎所有產品的出貨量都成功超過了行業水平，儘管定價環境充滿挑戰，但這仍提振了我們的季度收益。第一季毛利率達到 31%，部分原因在於高於預期的後進先出法、效益、現有成本和重置成本的更好協調以及增值處理能力帶來的毛利率穩定性。

We recorded LIFO income of $50 million in the first quarter compared to our guidance of $20 million. As prices declined more than we anticipated, we have increased our 2024 annual LIFO income estimate from $80 million to $200 million. Accordingly, we currently expect to record approximately $50 million of LIFO income in the second quarter of 2024.

我們第一季的後進先出收入為 5000 萬美元，而我們的指導則為 2000 萬美元。由於價格下降幅度超過我們的預期，我們將 2024 年 LIFO 年度營收預估從 8,000 萬美元上調至 2 億美元。因此，我們目前預計 2024 年第二季的 LIFO 營收將達到約 5,000 萬美元。

On a FIFO basis, which is how we monitor our day-to-day operating performance, and which excludes the effect of our LIFO inventory valuation method. Our gross profit margin improved by roughly 80 basis points compared to the prior quarter to 29.6% as we saw improved alignment of inventory cost on hand with replacement costs. This trend began to reverse in March and has continued in the second quarter. While most carbon product prices began to stabilize in April, we'll continue to see short-term gross profit margin pressures throughout the second quarter as we get better alignment of costs on hand with replacement costs. As of the end of the first quarter, the LIFO reserve on our balance sheet was $529 million, which will generate LIFO income and benefit future period operating results to mitigate the impact of potential further declines in metal prices.

以先進先出為基礎，這是我們監控日常經營績效的方式，並且不包括後進先出庫存估值方法的影響。與上一季相比，我們的毛利率提高了約 80 個基點，達到 29.6%，因為我們看到現有庫存成本與重置成本的一致性得到了改善。這種趨勢從三月開始逆轉，並在第二季度持續。雖然大多數碳產品價格在四月開始穩定，但隨著我們更好地調整現有成本與重置成本，我們將在整個第二季度繼續看到短期毛利率壓力。截至第一季末，我們資產負債表上的後進先出準備金為 5.29 億美元，這將產生後進先出的收入，並有利於未來期間的經營業績，以減輕金屬價格潛在進一步下跌的影響。

Moving along to expenses. On a year-over-year basis, same-store non-GAAP SG&A expenses increased $7.1 million or 1.1%, primarily due to the increased head count to accommodate organic growth, which was partially offset by lower incentive-based compensation resulting from lower profitability. As a reminder, our model normalizes expenses by rightsizing incentives as profits trend down.

繼續支出。與去年同期相比，同店非GAAP SG&A 費用增加了710 萬美元，即1.1%，主要是由於為適應有機增長而增加了員工人數，但盈利能力下降導致的基於激勵的薪酬減少部分抵消了這一增加。提醒一下，隨著利潤下降，我們的模型透過調整激勵措施來使支出正常化。

I'll now move on to discuss balance sheet and cash flow. For the first quarter, we generated $126.3 million in operating cash flow, which helps fund $108.7 million in capital expenditures, $53.7 million for an acquisition and the return of $65.3 million to our stockholders through dividends. While we did not have any share repurchases in the first quarter of 2024, we have $1.44 billion remaining under our share repurchase authorization and ample liquidity for opportunistic repurchases.

我現在將繼續討論資產負債表和現金流量。第一季度，我們產生了 1.263 億美元的營運現金流，這有助於為 1.087 億美元的資本支出、5,370 萬美元的收購提供資金，並透過股息向股東返還 6,530 萬美元。雖然我們在 2024 年第一季沒有進行任何股票回購，但我們的股票回購授權剩餘 14.4 億美元，並且有充足的流動性用於機會性回購。

Turning now to our second quarter outlook. Overall, we expect a better-than-normal seasonal recovery in demand in the second quarter of 2024 despite prevailing macroeconomic uncertainty and geopolitical matters. We also expect shipping volumes to increase 2.5% to 4.5% sequentially in the second quarter with approximately 2% of the sequential growth coming from recently completed acquisitions.

現在轉向我們的第二季展望。總體而言，儘管宏觀經濟不確定性和地緣政治問題普遍存在，但我們預計 2024 年第二季需求季節性復甦將優於正常水準。我們也預計第二季出貨量將季增 2.5% 至 4.5%，其中約 2% 的環比成長來自最近完成的收購。

On the pricing side, we expect our average selling price per ton sold for the second quarter to be down 1% to 3% compared to the first quarter, which will generate some short-term pressure on our gross profit margin as we work through higher cost inventory on hand. Based on these expectations, we anticipate non-GAAP earnings per diluted share in the range of $4.70 to $4.90 for the second quarter of 2024.

在定價方面，我們預計第二季的每噸平均售價將比第一季下降1%至3%，這將對我們的毛利率產生一些短期壓力，因為我們正在努力提高毛利率。成本。根據這些預期，我們預計 2024 年第二季的非 GAAP 攤薄每股收益將在 4.70 美元至 4.90 美元之間。

This concludes our prepared remarks. Thank you for your participation. And at this time, we'll now open the call up to questions. Operator?

我們準備好的演講到此結束。感謝您的參與。此時，我們將開始電話提問。操作員？

(Operator Instructions) The first question comes from the line of Phil Gibbs with KeyBanc Capital Markets.

（操作員說明）第一個問題來自 KeyBanc Capital Markets 的 Phil Gibbs。

You mentioned the short-term gross margin pressures in the second quarter from some of the higher cost inventory that you'll have to let -- are you expecting or should we expect, assuming that prices generally level out for the product that you sell that FIFO gross margins will begin to improve in the third quarter.

您提到第二季的短期毛利率壓力來自您必須放棄的一些成本較高的庫存 - 您是否預期或我們應該預期，假設您銷售的產品價格普遍持平先進先出毛利率將在第三季度開始改善。

Yes. So as has been consistent in our business for decades in the service center business, we have to manage through different pricing fluctuations, and it's part of what we do. Prices deteriorated a little more than we anticipated in the first quarter, but early in the quarter for certain products, there were some price hikes. So just with the normal lag we have to work through as we receive the higher priced material. And if selling prices continue to decline. And so that just takes a little bit for a correction, but we do expect it to be temporary, as you stated.

是的。因此，正如我們幾十年來在服務中心業務中的一貫做法一樣，我們必須應對不同的價格波動，這是我們工作的一部分。第一季價格惡化程度略高於我們的預期，但本季初某些產品的價格出現了一些上漲。因此，當我們收到價格較高的材料時，我們必須克服正常的滯後現象。而如果銷售價格繼續下降。因此，這只需要一點修正，但正如您所說，我們確實希望這只是暫時的。

As prices level out, then we should see some margin expansion. Also with our gross profit margins, they certainly are impacted by the base metal price. However, as we have and do continue to increase the amount of value-added processing that we perform for our customers, we do have a little more cushion in there to make our margins a little more stable by taking -- it's not just the base price fluctuations. We can maintain a consistent margin on the value-added processing portion.

隨著價格趨於平穩，我們應該會看到利潤率擴大。此外，我們的毛利率肯定會受到基本金屬價格的影響。然而，隨著我們已經並將繼續增加為客戶執行的增值處理量，我們確實有更多的緩衝，可以通過採取——這不僅僅是基礎——來使我們的利潤更加穩定。我們可以在增值加工部分保持一致的利潤。

Okay. And then when I look at operating expenses, they were a little bit higher than what we were anticipating. Do you have -- do you have contractual resets or labor renegotiations that you do every January 1? Or is there insurance picking up or something along those lines? Or is it more of this -- more of the same relative to the fourth quarter, where you talked about the fact that you do have some infrastructure in the form of new plants, which are not contributing to revenue quite yet. I'm just trying to understand that.

好的。然後當我查看營運費用時，它們比我們的預期要高一些。您是否每年 1 月 1 日都會進行合約重置或勞資重新談判？或是有沒有保險或類似的東西？或者更多的是——與第四季度相比，更多的是相同的，你談到了這樣一個事實，即你確實擁有一些新工廠形式的基礎設施，但這些基礎設施尚未對收入做出貢獻。我只是想理解這一點。

Yes. So we have different timing on kind of wage increases throughout the year. But GM1 is probably about half of our companies probably increased wages at that time. It's a little more broad-based. Our volumes were up, so more expense comes along with increased volume, just packaging supplies, various warehouse expenses, trucking, delivering more. So it was a little broad-based. I don't think there was anything in particular, but your point is right too, Phil, that we commented before. We do have some greenfields and some expansions in process where it does take a little time to ramp up. So the expense load could be a little heavy. So there is a little bit of that.

是的。因此，我們全年薪資成長的時間安排有所不同。但是GM1大概是我們公司當時可能加了一半的薪水。它的基礎更廣泛一些。我們的產量增加了，因此隨著產量的增加，費用也隨之增加，只是包裝用品、各種倉庫費用、卡車運輸、交付更多費用。所以它的基礎有點廣泛。我不認為有什麼特別的，但菲爾，你的觀點也是正確的，我們之前評論過。我們確實有一些綠地和一些擴建項目正在進行中，確實需要一些時間來加速。所以費用負擔可能有點重。所以有一點這樣的事情。

We also, I think, commented last quarter that Safety is our #1 priority, and that takes a lot of training, especially in today's world with the workforce and so it probably takes us longer to onboard employees and you have to carry a little more to be able to get them properly trained.

我認為，我們上個季度也評論說，安全是我們的第一要務，這需要大量培訓，特別是在當今世界的勞動力中，因此我們可能需要更長的時間來僱用員工，並且您必須攜帶更多的東西以便能夠對他們進行適當的訓練。

And Phil, this is Arthur. I'll just add that, year-over-year on a same-store basis, we're only up 1%. So -- and we talk about our incentive pay structure that kind of moderates expenses. So head count is up a little bit, but then incentive comp is down. So net-net, year-over-year, on a same-store basis, we're only up 1%.

菲爾，這是亞瑟。我只想補充一點，以同店計算，我們只成長了 1%。因此，我們討論了我們的激勵性薪酬結構，該結構可以調節支出。因此，員工人數增加了一點，但激勵措施卻下降了。因此，以淨值計算，同店年比，我們僅成長了 1%。

And then when you exclude the same-store (inaudible) ease that out, what, I guess, is the incremental operating expense that may not be that may not be completely, I guess, overcome through revenue at this point from some of these greenfield you're talking about? I mean, is it upwards of $15 million to $20 million at this point that might be under absorbed?

然後，當您排除同店（聽不清楚）的緩解措施時，我猜，增量營運費用可能不會完全透過其中一些綠地的收入來克服你在說什麼？我的意思是，目前吸收不足的金額是否超過 1500 萬至 2000 萬美元？

No. It wouldn't be that much though.

不，不過不會那麼多。

Okay. And then lastly, as you guys look at CapEx, you talked about the 440 and then some carryover getting it to 500 cash. Is the 2/3 growth CapEx based on the 440 number -- what you [ceased] on to maintenance level?

好的。最後，當你們看資本支出時，你們談到了 440 美元，然後是一些結轉，使其達到 500 美元現金。 2/3 成長的資本支出是否基於 440 數字－您[停止]維持水準？

Yes. And that's been pretty consistent. The last, at least, I'd say, probably 4 or 5 years, the majority of our CapEx spend is growth related.

是的。這非常一致。我想說，至少在過去的四、五年裡，我們的大部分資本支出都與成長有關。

Next question comes from the line of Martin Englert with Seaport Search Partners.

下一個問題來自 Martin Englert 和 Seaport Search Partners 的電話。

What were the same-store volumes in 2Q and 3Q of last year? I think you reported them again this quarter. I think it might have gone a couple of quarters where it wasn't reported or perhaps they didn't differ from the reported tons sold.

去年第二季和第三季的同店銷售量是多少？我認為您本季再次報告了這些情況。我認為可能已經有幾個季度沒有報告了，或者可能與報告的銷售噸數沒有什麼不同。

Martin, probably only had one relatively small acquisition last year and so -- and another one [product], they're not sort of story-changing numbers, at least the 2 completed ones that would affect the same-store numbers. I don't have that number handy. But if you go to our public filings, you'll see it.

馬丁去年可能只進行了一項相對較小的收購，因此，還有另一項[產品]，它們並不是改變故事的數字，至少是會影響同店數字的兩個已完成的數字。我手邊沒有那個號碼。但如果你查看我們的公開文件，你就會看到這一點。

Yes. I mean, yes, we reported if it's -- I mean we always reported in the SEC filings, but we don't necessarily talk about it if it's -- if there's not a meaningful difference, as Arthur indicated.

是的。我的意思是，是的，我們報告了是否——我的意思是我們總是在美國證券交易委員會的文件中進行報告，但我們不一定會談論它——如果沒有有意義的差異，正如阿瑟指出的。

Okay. So pretty -- something pretty close to what the volumes were -- that were reported. When you look at the midpoint of the volume guide. I think it implied around 4% growth year-on-year at the group level, including acquisitions versus the negative contraction of 2% for 1Q. Is that right?

好的。非常漂亮——與報道的數量非常接近。當您查看音量指南的中點。我認為這意味著集團層面同比增長約 4%，其中包括收購，而第一季則出現 2% 的負收縮。是對的嗎？

Yes. I think you're in the right ballpark. That's correct.

是的。我認為你的想法是正確的。這是正確的。

Yes. And Martin, maybe one of the things if you're kind of focusing on our shipment levels. And certainly, the acquisitions will add to that. Q1, like we felt pretty good about when I looked at our stock price this morning, but we thought we had a good first quarter, [absent] it being a little more difficult from a pricing standpoint than we had anticipated. From a shipment standpoint, something we saw and we've heard from others in our industry in the broader industrials, we're probably a little surprised in March. March is typically a pretty strong shipment month for us and in the industry. And really, the second half of March, we saw more of a falloff in our tons shipped that we had anticipated. Good Friday actually fell in March this year, which, obviously, we can look at the calendar, we understood that. But it seemed that like spring break, Easter, buyers waiting for prices to go down, especially on the carbon flat-rolled side, they kind of pulled back a bit. They were on vacation. We just saw -- we were a little surprised by those last couple of weeks of March.

是的。馬丁，如果您關注我們的發貨水平，也許就是其中之一。當然，收購也會增加這一點。第一季度，當我今天早上查看我們的股價時，我們感覺很好，但我們認為第一季度表現不錯，[缺席]從定價的角度來看，這比我們預期的要困難一些。從出貨量的角度來看，我們在更廣泛的行業中看到了一些事情，也從我們行業中的其他人那裡聽到了一些事情，我們可能對三月感到有點驚訝。對我們和整個產業來說，三月通常是出貨量相當強勁的月份。事實上，三月下半月，我們的出貨量比我們預期的下降了更多。耶穌受難日實際上是在今年三月，顯然，我們可以看看日曆，我們就明白了。但似乎像春假、復活節一樣，等待價格下跌的買家，尤其是碳扁材方面，他們有點回調。他們正在度假。我們剛剛看到——我們對三月的最後幾週感到有點驚訝。

The good news is, right, that pushes into April and the second quarter, which is why we feel that we are anticipating more than seasonal improvement in our second quarter tons shipped this year.

好消息是，這將進入四月和第二季度，這就是為什麼我們認為我們預計今年第二季度發貨量將不僅僅是季節性改善。

And typically, the second quarter is somewhat flat with the first quarter. So and our guidance implies on a same-store basis, some uptick in sequential tons shipped.

通常情況下，第二季與第一季持平。因此，我們的指導意味著在同店基礎上，連續出貨噸數有所上升。

When you look at it on a same-store basis, the growth rate, it's still pivots positive, which, I think, a couple percent, which aligns with what you're seeing or expecting with a sequential uptick, and then the 2% growth from acquisition on the quarter, I think that implies something like 29,000 tons from the acquisition like a quarterly number? Is that reasonable for modeling purposes?

當你以同店為基礎來看增長率時，它仍然呈正向增長，我認為有幾個百分點，這與你所看到或預期的連續上升相符，然後是 2%本季度收購量增長，我認為這意味著季度收購量約為29,000 噸？這對於建模目的合理嗎？

That's not unreasonable Yes.

這不無道理是的。

For the repurchase -- no repurchases in the quarter, was this mostly due because of the acquisition opportunities and any other color you can provide on the acquisition pipeline?

對於回購——本季度沒有回購，這主要是因為收購機會以及您可以在收購管道上提供的任何其他顏色嗎？

Yes. So I think kind of 2 things in there in that question, Martin. So from a repurchase standpoint, we continue to monitor the market and opportunistically repurchase our shares. The fact that we acquired acquisitions, that we did complete some acquisitions in the first quarter didn't impact our repurchase activity. Our balance sheet is strong enough that as we've said for the last couple of years, we're able to execute on all 4 of our capital allocation buckets at the same time. So we just -- we're not in the market for repurchases in Q1, but we will continue to opportunistically repurchase our shares. Again, irrespective of what we have going on, on the acquisition side. We were very happy to welcome Cooksey, American Alloy and Mid-West materials to the Reliance family. So far this year in 2024, we've seen good activity. We continue to see good activity opportunities out there in the acquisition market. So we expect to continue to be active there as well.

是的。所以我認為這個問題中有兩件事，馬丁。因此，從回購的角度來看，我們將繼續監控市場並伺機回購我們的股票。事實上，我們進行了收購，我們在第一季完成了一些收購，但這並沒有影響我們的回購活動。我們的資產負債表足夠強大，正如我們過去幾年所說的那樣，我們能夠同時執行所有 4 個資本配置桶。所以我們只是 - 我們不會在第一季回購市場，但我們將繼續機會主義地回購我們的股票。再說一遍，無論我們在收購方面發生了什麼。我們非常高興地歡迎 Cooksey、American Alloy 和 Mid-West 材料加入 Reliance 大家庭。 2024 年到目前為止，我們已經看到了良好的活動。我們繼續在收購市場上看到良好​​的活動機會。因此，我們預計也將繼續在那裡活躍。

I wanted to come back one last one on the expectation of -- there was some delay at the end of the quarter with demand maybe and in March and maybe some of it was pushed. So do you anticipate instead of maybe historically flattish Q-on-Q, you expect some improvement because of that dynamic. Are you seeing that in your order entry and your order intake so far, I guess maybe another way to ask if this --how are you seeing activity in April to date here as far as volumes.

我想根據預期返回最後一篇文章——季度末的需求可能會出現一些延遲，而三月份的需求可能會有所延遲，其中一些可能會被推遲。因此，您是否預計，由於這種動態，您會期望有所改善，而不是歷史上平淡的 Q-on-Q。您是否在您的訂單輸入和迄今為止的訂單接收中看到這一點，我想也許可以用另一種方​​式來詢問這一點 - 您如何看待四月份迄今為止的交易量。

Yes. And that's Martin, a good point because remember, 40% of our orders, the customer calls us today, we deliver tomorrow. So we don't have backlogs and things that other people talk about. Certain of our companies, depending on the end-markets they sell into, they may have a little more backlog visibility. So we have seen a little bump in April from March levels. I think general sentiment across a lot of our FOCs is pretty positive coming into the second quarter.

是的。這就是馬丁，這是一個很好的觀點，因為請記住，我們 40% 的訂單，客戶今天打電話給我們，我們明天發貨。所以我們沒有積壓的訂單和其他人談論的事情。我們的某些公司，根據他們銷售的終端市場，他們可能有更多的積壓可見度。因此，我們看到 4 月份的水準較 3 月份的水準略有上升。我認為進入第二季度我們許多FOC 的整體情緒非常積極。

Okay. I appreciate that. And it was a nice job managing the FIFO gross margins on the quarter.

好的。我很感激。本季 FIFO 毛利率的管理非常出色。

Thanks, Martin. Appreciate that.

謝謝，馬丁。感謝。

(Operator Instructions) Next question comes from the line of Timna Tanners with Wolfe Research.

（操作員說明）下一個問題來自 Timna Tanners 和 Wolfe Research 的生產線。

I wanted to follow up with the second quarter outlook and kind of ask what drives the low end versus the high end of how you're looking at the guidance?

我想跟進第二季的前景，並詢問是什麼推動了您如何看待指導的低端與高端？

Timna, Yes. I mean, in general, it's kind of with our business model, we think, and we do our best to generally anticipate both volumes and pricing dynamics. And we never know with our broad product mix, our next-day orders. So it's really just that combination of within that range of shipments, within that range of pricing. How much pressure is there on margins. Margin is a big driver, getting down to the EPS line as well as pricing. So we just try to give a little room in there for those different variables.

蒂姆納，是的。我的意思是，總的來說，我們認為這與我們的商業模式有關，我們會盡力整體預測銷售和定價動態。我們永遠不知道我們廣泛的產品組合，我們的隔天訂單。因此，這實際上只是在該範圍內的發貨量和在該範圍內的定價的組合。利潤壓力有多大。利潤率是一個很大的驅動因素，影響到每股盈餘線以及定價。所以我們只是嘗試為這些不同的變數留一點空間。

Okay. In terms of trying to manage some of that variation, as you mentioned, do you ever consider either the futures market to kind of temper some of that volatility at least on the carbon flat-rolled side? And do you think about the stronger dollar changing your appetite for imports?

好的。正如您所提到的，在嘗試管理某些變化方面，您是否考慮過期貨市場至少在碳扁鋼方面緩和一些波動性？您認為美元走強是否會改變您對進口的興趣？

Timna, it's Steve. As you know, 95% at least of our material that we purchase is domestically sourced. So that's kind of our natural hedge. We feel like the lead times that we received, our inventory management by our leaders in the field, which we think they're doing a great job because there's been a lot of pricing challenges over the last year or so. So I think that in this type of a market, I think, that we thrive on our people in the field (inaudible).

提姆納，我是史蒂夫。如您所知，我們購買的材料至少 95% 是國內採購的。這就是我們的天然對沖。我們覺得我們收到的交貨時間，我們該領域領導者的庫存管理，我們認為他們做得很好，因為在過去一年左右的時間裡出現了很多定價挑戰。因此，我認為在這種類型的市場中，我們的繁榮取決於我們在該領域的員工（聽不清楚）。

Yes. And then Timna, in terms of pricing forecast a lot of -- there's product where, yes, you certainly -- you kind of look at the futures market. But to Steve's point, being a domestic buyer, you have a lot of visibility to those products and their pricing. So especially for a quarter out. But then with that said, there's always -- there's volatility that could be unexpected. So that happens. And just like we had this quarter where we thought pricing was going to be up a little bit, but we ended up down a little. So -- but I mean, again, yes, we consider all that information and then make some informed decisions based on what we see with the lead times and demand and with the different geographies and the products that we have. So all of that gets factored into our forecast.

是的。然後，蒂姆納，就定價預測而言，有很多產品，是的，你當然會關注期貨市場。但就史蒂夫而言，作為國內買家，您對這些產品及其定價有很多了解。所以特別是對於四分之一的比賽。但話雖如此，總是會有意想不到的波動。所以就會發生這種情況。就像本季我們認為價格會上漲一點一樣，但最終價格卻下跌了一點。所以，但我的意思是，是的，我們會考慮所有這些信息，然後根據我們所看到的交貨時間和需求以及不同的地理位置和我們擁有的產品做出一些明智的決定。因此，所有這些都被納入我們的預測中。

And I would also just add to that, we're primarily buying and selling in the spot market. We don't have a lot of longer-term fixed sale price contracts, which, if that's your model, you probably do need to consider hedging more, but that's just not our model.

我還要補充一點，我們主要在現貨市場買賣。我們沒有很多長期固定銷售價格合同，如果這是您的模式，您可能確實需要考慮更多對沖，但這不是我們的模式。

Okay. Fair enough. And just one more if I could. I thought it would be interesting to touch on the labor market. I thought it was interesting to hear you talk about incentive comp and how you adjust for that. Given that the labor market is tighter, how do you manage in a softer market or in a period of lower profitability, less incentive comp, but also the challenges of retaining and hiring people.

好的。很公平。如果可以的話，就再多一個吧。我認為觸及勞動市場會很有趣。我認為聽到你談論激勵補償以及你如何對此進行調整很有趣。鑑於勞動力市場更加緊張，您如何在市場疲軟或盈利能力較低、激勵措施較少的時期進行管理，而且還面臨留住和僱用人才的挑戰。

Yes. I mean, Tim, certainly, it's been one more challenge all of our people out in the field have had to deal with over the last few years. We have seen the labor market improve a bit as far as seeing more candidates, more people interested in jobs, but we're not always the sexiest industry to some of the people out there when they're looking at opportunities. But we have been more successful bringing people in. We think we do a good job of retaining people. Once [we're] good people once we have them in, we want to treat them fairly, provide them with good benefits, pay them fairly. Certainly, when things get a little tougher, they may be bringing less home, but we've also had some pretty good years the last couple of years too where our people have done really well, doing more value-added processing also provides a little more stability for our workforce and the profitability and their incentives that they may take home, growing the business, which we've been focused on. So there are ways to manage around that. But it's not easy these days, but I don't know that we've seen any significant reaction to those factors.

是的。我的意思是，蒂姆，這當然是我們所有在該領域的人員在過去幾年中必須應對的另一個挑戰。我們看到勞動力市場有所改善，出現了更多的候選人，更多的人對工作感興趣，但對於一些正在尋找機會的人來說，我們並不總是最性感的行業。但我們在吸引人才方面取得了更大的成功。一旦我們成為好人，一旦我們接納了他們，我們就會公平地對待他們，為他們提供良好的福利，公平地支付他們的工資。當然，當事情變得有點困難時，他們帶回家的東西可能會減少，但過去幾年我們也經歷了一些相當好的幾年，我們的員工做得非常好，進行更多的增值加工也提供了一點我們的員工隊伍更加穩定，他們可以帶回家的盈利能力和激勵措施，從而發展業務，這是我們一直關注的重點。因此，有一些方法可以解決這個問題。但現在這並不容易，但我不知道我們是否看到了對這些因素的任何重大反應。

Next question comes from the line of Phil Gibbs with KeyBanc Capital Markets.

下一個問題來自 KeyBanc Capital Markets 的 Phil Gibbs。

Yes. My follow-up was based largely on what you're seeing in both the aerospace and defense side. I know you've got kind of a balanced mix within your portfolio. I think we're trying to parse through all the headlines on the commercial aerospace volatility with Boeing, but also trying to recognize the strength in the defense market. So just curious in terms of what your -- what your forward expectations are, what you're seeing? I know you're serving some specific programs as well. So just curious.

是的。我的後續行動主要基於您在航空航天和國防方面看到的情況。我知道你的投資組合有一定的平衡。我認為我們正在嘗試解析有關波音商業航空波動的所有頭條新聞，但也在嘗試認識到國防市場的實力。所以只是好奇你的未來期望是什麼，你看到了什麼？我知道您也在提供一些特定的計劃。所以只是好奇。

Yes, Phil, on the aerospace side, our Q1 sales, aerospace represented about 9% of that. About half of that commercial, about half defense and space. On the defense and space side, space is a little smaller, but it's strong and growing. The defense continues to be strong. We're seeing increased demand, whether they're specifically our aerospace business in that 9% where we're participating on several key programs, both the U.S. and internationally, and we see order activity picking up there, but not included in the 9%.

是的，菲爾，在航空航太方面，我們第一季的銷售額中，航空航太約佔其中的 9%。大約一半是商業廣告，大約一半是國防和太空。在防禦和太空方面，太空有點小，但它很強大並且不斷增長。防守依然強勁。我們看到需求不斷增加，無論是特別是我們的航空航天業務，我們參與了美國和國際上的幾個關鍵項目，我們看到那裡的訂單活動有所增加，但不包括在這 9% 中。 %。

A lot of our companies we'll sell into like missiles, ammunitions, that doesn't all get picked up in that number. And that continues to be strong, and we see -- with the unfortunate circumstances around the world today, we see some continued demand strength in that area. And then on the commercial side, which you know we have companies both servicing in the U.S. and Europe, the airplane manufacturers, build rates actual is much less than what is announced and what the targets are right now. So we do see some buildup, a little pressure starting in the supply chain on the commercial side as the whole supply chain has to really kind of correct for what the actual build rates are.

我們將向許多公司出售飛彈、彈藥等產品，但這些產品並沒有全部達到這個數字。這種需求仍然強勁，我們看到，鑑於當今世界各地的不幸情況，我們看到該領域的需求持續強勁。然後在商業方面，你知道我們在美國和歐洲都有公司提供服務，飛機製造商的實際建造率遠低於宣布的和目前的目標。因此，我們確實看到了一些積累，商業方面的供應鏈開始承受一些壓力，因為整個供應鏈必須真正糾正實際的建造率。

So we do anticipate some near-term pressure on the commercial aerospace side. However, long term, there are just a lot of orders out there. We're participating on pretty much all programs. And we're still bullish for the long term on aerospace, but expect a little pressure in the near term.

因此，我們確實預期商業航空航太方面近期會面臨一些壓力。然而，從長遠來看，訂單量仍然很大。我們幾乎參與了所有項目。我們仍然看好航空航太業的長期前景，但預計短期內會面臨一些壓力。

And then just one more for me, on this solid CapEx budget that you have for this year? I know you've said in the past that they're -- there's hundreds of projects in there, but maybe if you could call out some of the larger ones that you either started or in the process of either this year or last year. And maybe where they are in the stages of maturation or commercial development.

那麼，對我來說，還有一個關於今年穩定的資本支出預算的問題？我知道您過去曾說過，其中有數百個項目，但也許您可以列出一些您今年或去年啟動或正在進行的較大項目。也許它們正處於成熟或商業發展階段。

Yes. I mean a couple of the big ones we've talked about semiconductor down in Texas. We've got a big build there to add more capacity. That one probably maybe later this year, we've kind of pulled back and have had some slight delays on that, which is okay because as you're probably aware, the actual semiconductor plants themselves, they've had starts and stops. And so -- so we've slowed a little bit there, but still long term, very bullish on that. We have, for one of our kind of specially long product companies in the Atlanta area. They're about ready to ramp-up service center business that they increase their capacity significantly moving into a newer building. On our tolling operations in the U.S., we've added a couple of lines that have started up recently. They're still ramping Mexico and our tolling businesses. We've also added some equipment down there. We've got a greenfield that's still a little early in the stages for some of our like heavier carbon products down in the Atlanta area. Steve, any.

是的。我的意思是我們在德克薩斯州談論過的一些重要的半導體。我們在那裡進行了大規模建設以增加更多容量。那可能是今年晚些時候，我們有點後退了，並且有一些輕微的延遲，這沒關係，因為正如你可能知道的那樣，實際的半導體工廠本身，他們已經開始和停止了。因此，我們在這方面放慢了一點，但從長遠來看，我們對此非常樂觀。我們在亞特蘭大地區擁有一家特殊長材產品公司。他們準備擴大服務中心業務，並大幅增加容量並搬入新大樓。在我們在美國的收費業務中，我們增加了幾條最近啟動的線路。他們仍在擴大墨西哥和我們的收費業務。我們還在那裡添加了一些設備。我們在亞特蘭大地區擁有一塊未開發的土地，對於我們的一些類似的重碳產品來說，這還處於早期階段。史蒂夫，任何一個。

I would just add, it's not a big headliner Phil, but we do a lot of upgrades. It doesn't have to be greenfield, but we'll upgrade some of our really important cut-to-length material for -- we're doing that in Decatur, Alabama and Portage Indiana. So that was offline for a little bit in the first quarter, and we're seeing a nice bounce back in production in those 2 key facilities.

我想補充一點，這不是菲爾的頭條新聞，但我們做了很多升級。它不一定是新建的，但我們將升級一些非常重要的定長切割材料——我們正在阿拉巴馬州迪凱特和印第安納州波蒂奇進行這項工作。因此，第一季有一段時間處於離線狀態，我們看到這兩個關鍵設施的生產出現了良好的反彈。

Thank you. Ladies and gentlemen, we have reached the end of question-and-answer session. I would now like to turn the floor over to Karla Lewis for closing comments.

謝謝。女士們、先生們，問答環節已經結束。我現在想請卡拉·劉易斯發表總結意見。

Thank you, and thanks again to everyone for joining our call today. And I would like to tell our Reliance family that we think you guys did a really good job managing through a tough environment in the first quarter, and we're very proud of what you did. And I'd also like to remind everyone that next month, we'll be in Miami, presenting at the BofA Global Metals, Mining and Steel Conference, and in Boston presenting at the KeyBanc Basic Materials Conference, and we hope to see many of you there. And thanks again, everyone, for your continued support of Reliance.

謝謝大家，並再次感謝大家今天加入我們的電話會議。我想告訴我們的 Reliance 家族，我們認為你們在第一季的艱難環境中做得非常好，我們為你們所做的感到非常自豪。我還想提醒大家，下個月，我們將在邁阿密出席美國銀行全球金屬、礦業和鋼鐵會議，並在波士頓舉行 KeyBanc 基礎材料會議，我們希望看到許多你在那裡。再次感謝大家對 Reliance 的持續支持。

Thank you. This concludes today's teleconference. You may disconnect your lines at this time. Thank you for your participation.

謝謝。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。