Olympic Steel Inc (ZEUS) 2025 Q2 法說會逐字稿

Good morning, and welcome to the Olympic Steel 2025 second quarter financial results conference call. (Operator Instructions) As a reminder, this conference is being recorded.

早安，歡迎參加奧林匹克鋼鐵公司2025年第二季財務業績電話會議。（操作說明）提醒各位，本次會議正在錄音。

At this time, I'd like to hand the conference over to Rich Manson, Chief Financial Officer at Olympic Steel. Please go ahead, sir.

此時，我想把會議交給奧林匹克鋼鐵公司的財務長里奇‧曼森。請繼續，先生。

Thank you, operator. Welcome to Olympic Steel's earnings call for the second quarter of 2025. Our call this morning will be hosted by our Chief Executive Officer, Rick Marabito; and we will also be joined by our President and Chief Operating Officer, Andrew Greiff.

謝謝接線生。歡迎參加奧林匹克鋼鐵公司2025年第二季財報電話會議。今天早上的電話會議將由我們的執行長里克·馬拉比托主持；我們的總裁兼營運長安德魯·格里夫也將參加。

Before we begin, I have a few reminders. Some statements made on today's call will be predictive and are intended to be made as forward-looking within the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995 and may not reflect actual results.

在開始之前，我先提醒幾點。今天電話會議上的一些陳述具有預測性，旨在根據 1995 年《私人證券訴訟改革法案》的安全港條款做出前瞻性陳述，但這些陳述可能與實際結果不符。

The company does not undertake to update such statements, changes in assumptions or changes in other factors affecting such forward-looking statements. Important assumptions, risks, uncertainties and other factors that could cause actual results to differ materially are set forth in the company's reports on Form 10-K and 10-Q and the press releases filed with the Securities and Exchange Commission.

本公司不承諾更新此類聲明、假設變更或影響此類前瞻性聲明的其他因素。可能導致實際結果與預期結果有重大差異的重要假設、風險、不確定性及其他因素已在本公司提交給美國證券交易委員會的 10-K 表格和 10-Q 表格報告以及新聞稿中列出。

During today's discussion, we may refer to adjusted net income per diluted share, EBITDA and adjusted EBITDA, which are all non- GAAP financial measures. A reconciliation of these non-GAAP measures to the most directly comparable GAAP financial measures is provided in the press release that was issued last night and can be found on our website.

在今天的討論中，我們可能會提到調整後每股攤薄淨收益、EBITDA 和調整後 EBITDA，這些都是非 GAAP 財務指標。昨晚發布的新聞稿中提供了這些非GAAP指標與最直接可比較的GAAP財務指標的調節表，該新聞稿可在我們的網站上找到。

Today's live broadcast will be archived and available for replay on Olympic Steel's website. Now I'll turn the call over to Rick.

今天的直播節目將被存檔，並可在奧林匹克鋼鐵公司的網站上重播。現在我把電話交給瑞克。

Thank you, Rich, and good morning, everyone. Thank you for joining us today to discuss Olympic Steel's 2025 second quarter results. I'll begin by providing some perspective on our performance in the second quarter and how we're navigating the current environment. Andrew will then review our segment performance. And following that, Rich will discuss our financial results in more detail. And then as always, we'll open the call up for your questions.

謝謝你，里奇，大家早安。感謝您今天與我們一起討論奧林匹克鋼鐵公司2025年第二季的業績。首先，我將介紹我們第二季的業績以及我們是如何應對當前環境的。安德魯隨後將審查我們各業務板塊的表現。接下來，Rich 將更詳細地討論我們的財務表現。然後，和往常一樣，我們會開放提問環節，接受大家的提問。

As we all know, news around tariffs has been dominating the headlines and creating uncertainty throughout the manufacturing industry, the metal supply chain and with our customers. Despite that uncertainty, our strategies and disciplined approach, combined with the strong foundation we have built for a more resilient Olympic Steel resulted in solid performance in a challenging environment.

眾所周知，關稅相關新聞一直佔據著各大媒體的頭條，為整個製造業、金屬供應鏈以及我們的客戶帶來了不確定性。儘管存在這種不確定性，但我們的策略和嚴謹的方法，加上我們為更具韌性的奧林匹克鋼鐵公司奠定的堅實基礎，使得我們在充滿挑戰的環境中取得了穩健的業績。

In the second quarter, we reported sales of $496 million and net income of $5.2 million. As we mentioned on our last call, we saw significant buy-ahead activity by our customers late in the first quarter as they reacted to the initial steel and aluminum tariffs and the potential for reciprocal tariffs.

第二季度，我們報告銷售額為 4.96 億美元，淨收入為 520 萬美元。正如我們在上次電話會議中提到的，由於客戶對最初的鋼鐵和鋁關稅以及可能出現的對等關稅做出反應，我們在第一季末看到了大量的提前採購活動。

As a result, there was some sequential volume pullback in the second quarter, yet our flat-rolled shipping volumes for the first half of 2025 remained slightly ahead of volume for the first half of 2024, while the industry actually experienced contraction for that period.

因此，第二季度銷量出現了一些環比回落，但我們 2025 年上半年的扁卷出貨量仍略高於 2024 年上半年的出貨量，而同期整個行業實際上出現了萎縮。

While second quarter volumes were down sequentially, margins from our flat-rolled business improved, and we delivered adjusted EBITDA of $20.3 million. That's a 26% increase compared with the first quarter. And importantly, all three of our business segments continued to deliver positive EBITDA. This performance is the result of our strategy to build a stronger, more resilient Olympic Steel.

雖然第二季銷量較上月下降，但我們的扁平軋製業務利潤率有所提高，調整後 EBITDA 為 2,030 萬美元。與第一季相比，成長了26%。更重要的是，我們所有三個業務部門都繼續實現了正的 EBITDA。這項成績是我們打造更強大、更具韌性的奧運鋼鐵策略的成果。

Our efforts to diversify into higher-value metal-intensive products, expand our fabricating capabilities and lean into our operational disciplines have put us in a position to deliver profitable results even when industry shipping volumes and pricing are falling.

我們努力實現產品多元化，生產高價值的金屬密集型產品，擴大製造能力，並加強營運管理，這使我們即使在行業出貨量和價格下降的情況下也能取得盈利。

With a strong balance sheet and more than $300 million of borrowing availability, we are in an excellent financial position to make additional accretive acquisitions as well as fund our organic investments to drive profitable growth, further efficiencies and enhance safety in our operations.

憑藉強勁的資產負債表和超過 3 億美元的可用借款，我們擁有良好的財務狀況，可以進行更多增值收購，並為我們的內生投資提供資金，以推動盈利增長，進一步提高效率並增強營運安全性。

As we previously announced, our robust 2025 CapEx plan, which includes new processing and automation equipment continues to proceed as scheduled. Andrew will share more specifics in a few moments. Our track record on the M&A front has been highly

正如我們之前宣布的那樣，我們強大的 2025 年資本支出計劃（包括新的加工和自動化設備）將繼續按計劃進行。安德魯稍後會分享更多細節。我們在併購方面的業績記錄一直都非常出色。

successful, completing eight acquisitions in the last seven years. The integration of our most recent acquisition, MetalWorks, has gone seamlessly and their results have been accretive to earnings.

過去七年中成功完成了八項收購。我們最近收購的 MetalWorks 公司的整合工作進展順利，其業績也提升了我們的獲利。

As we look ahead to the second half of the year, we expect the environment will remain challenging. We do, however, see a few positive emerging trends like resolution of reciprocal tariffs and the new tax legislation that reinforce our optimism for the longer-term outlook for the steel industry and especially for Olympic Steel.

展望下半年，我們預期環境仍將充滿挑戰。不過，我們也看到了一些積極的新興趨勢，例如相互關稅問題的解決和新的稅收立法，這些都增強了我們對鋼鐵業，特別是奧林匹克鋼鐵公司長期前景的樂觀態度。

Andrew will have more to share on that in his comments. As always, I'm proud of our team for their hard work and dedication to Olympic Steel. I'm confident that together, we continue to build on our strengths and ensure Olympic Steel continues to deliver profitable results no matter the market environment.

安德魯將在評論中分享更多相關資訊。一如既往，我為我們團隊的辛勤付出和對奧林匹克鋼鐵的奉獻感到自豪。我相信，只要我們齊心協力，就能繼續發揮自身優勢，確保奧林匹克鋼鐵公司無論在何種市場環境下都能持續獲利。

I'll now turn the call over to Andrew.

現在我將把電話交給安德魯。

Thank you, Rick, and good morning, everyone. We continue to navigate an unprecedented environment for the metals industry. As previously noted, the 25% sequential increase in first quarter 2025 volume was generated by purchasing ahead of anticipated price increases. Shipping data from our trade association indicates that the most products, service center shipping rates in 2025 are below 2024. Despite this negative trend, our first half 2025 flat-rolled shipments remain above our first half 2024 shipping levels.

謝謝你，里克，大家早安。我們仍在努力應對金屬產業前所未有的挑戰。如前所述，2025 年第一季銷量環比增長 25% 是由於提前購買以應對預期價格上漲所致。我們產業協會提供的運輸數據顯示，2025 年大多數產品的服務中心運輸費率低於 2024 年。儘管有這種負面趨勢，但我們 2025 年上半年的扁卷出貨量仍高於 2024 年上半年的出貨量水準。

As Rick discussed, our team has done an excellent job positioning Olympic Steel for success in even the toughest markets. During the second quarter, we improved margins for our flat-rolled products. This improvement, combined with the steadiness of our end products businesses helped to drive a 26% sequential increase in adjusted EBITDA, showing once again our ability to be profitable in the face of challenging conditions. This was an outstanding effort by our team to stay focused on controlling what we can control.

正如里克所說，我們的團隊在幫助奧林匹克鋼鐵公司即使在最艱難的市場中取得成功方面做得非常出色。第二季度，我們提高了扁軋產品的利潤率。這項改善，加上我們終端產品業務的穩定性，推動調整後 EBITDA 較上季成長 26%，再次顯示我們在充滿挑戰的環境下仍能獲利。我們的團隊在專注於控制我們能夠控制的事情方面做出了卓越的努力。

Second quarter activity in our Carbon segment reflected the overall metals industry sentiment. Profitability remained solid with second quarter EBITDA of $12.5 million with strength from our manufactured product companies. The pipe and tube segment recorded adjusted EBITDA of $6.7 million. The Pipe and Tube team continues to focus on fabrication with the goal to grow this business and drive margin improvement. We expect improved second half 2025 demand for data center work related to Pipe and Tube.

我們碳業務板塊第二季的業績反映了整個金屬產業的市場情緒。獲利能力保持穩健，第二季 EBITDA 為 1,250 萬美元，主要得益於我們製造產品公司的強勁表現。管道和管材業務部門的調整後 EBITDA 為 670 萬美元。管道和管材團隊繼續專注於製造，目標是發展這項業務並提高利潤率。我們預計 2025 年下半年資料中心管線和管材相關工作的需求將會有所改善。

Business conditions for both stainless and aluminum products began to improve during the second quarter, resulting in sequential improvements in both volume and profitability for the Specialty Metals Group. EBITDA was $5.9 million, and more than 60% improvement from the first quarter.

第二季度，不鏽鋼和鋁製品的經營狀況開始好轉，特種金屬集團的銷售量和獲利能力也隨之較上季提高。EBITDA 為 590 萬美元，比第一季成長超過 60%。

We also gained market share across our stainless and aluminum product lines. We are seeing momentum in the market for the second half of 2025 following the doubling of Section 232 tariffs on steel and aluminum to 50% and subsequent domestic mill price increases.

我們在不銹鋼和鋁製品領域也獲得了市場份額。隨著 232 條款對鋼鐵和鋁的關稅提高一倍至 50%，以及隨後國內鋼廠價格上漲，我們看到 2025 年下半年市場勢頭強勁。

Our robust CapEx plan for 2025 includes $35 million of spending, primarily on organic growth opportunities, which include a new cut-to-length line in Minneapolis, Minnesota, a new white metals cut-to-length line in Schaumburg, Illinois, the automation of our warehouse in Chambersburg, PA, and the expansion of Action Stainless's presence in Houston, Texas, along with a new high-speed stainless slitter at our Berlin Metals operation outside of Gary, Indiana.

我們為 2025 年制定的穩健資本支出計劃包括 3500 萬美元的支出，主要用於有機增長機會，其中包括在明尼蘇達州明尼阿波利斯新建一條定長切割生產線，在伊利諾伊州紹姆堡新建一條白金屬定長切割生產線，對我們在賓夕法尼亞州錢伯斯堡的倉庫進行自動化改造，擴大 Action Stainless 在德克薩斯州休斯頓的高速

With the exception of the slitter, the other projects are expected to be operational by the end of 2025 and will help fuel our growth in 2026 and beyond. The Berlin slitter is expected to be operational by the end of the first quarter of 2026. While we expect market uncertainty to remain in the near term, we are encouraged by the emerging trends and opportunities for the steel industry. For example, we are seeing increased inquiries for fabrication services, especially amongst OEMs looking to onshore, outsource or expand their first stages of manufacturing in the US.

除了分切機之外，其他項目預計將於 2025 年底投入運營，並將有助於推動我們在 2026 年及以後的成長。柏林分切機預計將於 2026 年第一季末投入營運。儘管我們預期短期內市場仍存在不確定性，但我們對鋼鐵業正在湧現的新趨勢和機會感到鼓舞。例如，我們看到對製造服務的需求不斷增長，尤其是一些原始設備製造商 (OEM) 希望將生產轉移到美國、外包或擴大其在美國的第一階段製造。

Olympic Steel is well positioned to capitalize on the trend to increase US manufacturing in the months and years to come. We are a resilient organization with the right strategy to lead us into the future, drive our growth and help us deliver profitable results under all market conditions. With that, I'll turn the call over to Rich.

奧林匹克鋼鐵公司已做好充分準備，將在未來幾個月和幾年內，充分利用美國製造業不斷增長的趨勢。我們是一個具有韌性的組織，擁有正確的策略，能夠引領我們走向未來，推動我們的成長，並幫助我們在各種市場條件下取得獲利成果。接下來，我將把電話交給里奇。

Thank you, Andrew. As you've heard from both Rick and Andrew, our team did an excellent job delivering solid results during the second quarter despite significant macroeconomic challenges and uncertainty. The benefits of our focus on controlling what we can control is apparent in our results. Before I discuss the results in more detail, I want to remind everyone that comparisons are impacted by the November 2024 acquisition of MetalWorks, whose results are included in the Carbon segment.

謝謝你，安德魯。正如里克和安德魯所說，儘管面臨巨大的宏觀經濟挑戰和不確定性，我們的團隊在第二季度仍然取得了出色的成績。我們專注於控制我們能夠控制的事情，其帶來的好處在我們的結果中顯而易見。在更詳細地討論結果之前，我想提醒大家，由於 2024 年 11 月收購了 MetalWorks，其業績包含在碳業務板塊中，因此比較結果會受到影響。

Second quarter net income totaled $5.2 million compared with $7.7 million in the second quarter of 2024. Adjusted EBITDA in the quarter was $20.3 million compared with $21.3 million in the prior year period. These results include $750,000 of LIFO expense in

第二季淨收入總計 520 萬美元，而 2024 年第二季為 770 萬美元。本季調整後 EBITDA 為 2,030 萬美元，而去年同期為 2,130 萬美元。這些結果包括75萬美元的後進先出法費用。

the second quarter of 2025 compared with $1 million of LIFO pre-tax income in the second quarter of 2024. Adjusted EBITDA for the second quarter of 2025 was 26% stronger than the adjusted EBITDA for the first quarter of 2025.

2025 年第二季度，後進先出法稅前收入為 100 萬美元，而 2024 年第二季為 100 萬美元。2025 年第二季的調整後 EBITDA 比 2025 年第一季的調整後 EBITDA 成長了 26%。

Consolidated operating expenses for the second quarter totaled $110.4 million compared with $104.6 million in the second quarter of 2024. Our second quarter 2025 operating expenses reflect the addition of MetalWorks, which does not report tons sold.

第二季綜合營運費用總計 1.104 億美元，而 2024 年第二季為 1.046 億美元。我們 2025 年第二季的營運費用反映了 MetalWorks 的加入，但該公司並未報告銷售噸數。

Therefore, operating expenses per ton at the consolidated level and for the Carbon segment will appear higher year-over-year. As a reminder, we do not report tons sold for McCullough Industries, EZ-Dumper, Metal-Fab, Shaw Stainless or the entire Pipe and Tube segment.

因此，合併層面和碳業務板塊的每噸營運費用將比去年同期增加。再次提醒，我們不報告 McCullough Industries、EZ-Dumper、Metal-Fab、Shaw Stainless 或整個管道和管材行業的銷售噸數。

Second quarter consolidated operating expenses included $2.5 million of MetalWorks operating and acquisition-related expenses and $200,000 of lower incentive expenses when compared to the second quarter of 2024.

第二季合併營運費用包括 250 萬美元的 MetalWorks 營運和收購相關費用，以及與 2024 年第二季相比減少的 20 萬美元激勵費用。

We reduced debt during the second quarter, bringing our total debt to $233 million, which is $39 million lower than year-end levels. We have approximately $305 million of availability under our asset-based revolving credit facility, providing us with an excellent source of flexible, low-cost capital to fund our strategic growth initiatives.

我們在第二季減少了債務，使我們的總債務降至 2.33 億美元，比年底水準減少了 3,900 萬美元。我們根據資產抵押循環信貸額度擁有約 3.05 億美元的可用資金，這為我們提供了靈活、低成本的優質資金來源，以資助我們的策略成長計畫。

Total capital expenditures totaled $17.5 million in the first half of 2025 compared with depreciation of $13 million. We estimate that 2025 capital expenditures will be approximately $35 million. The investment is higher than historical levels as we focus on supporting our automation and additional organic growth initiatives, as Andrew noted.

2025 年上半年資本支出總額為 1,750 萬美元，而折舊額為 1,300 萬美元。我們預計 2025 年的資本支出約為 3,500 萬美元。正如安德魯指出的那樣，由於我們專注於支援自動化和其他內生成長計劃，因此投資金額高於歷史水平。

Our second quarter 2025 effective tax rate was 29.1% compared with 28.4% in the same period last year. We expect our 2025 tax rate to approximate 28% to 29%. In addition, we paid a quarterly dividend of $0.16 per share in the second quarter. Our Board of Directors approved our next regular quarterly cash dividend of $0.16 per share, which is payable on September 15, 2025, to shareholders of record on September 2, 2025.

2025 年第二季實際稅率為 29.1%，去年同期為 28.4%。我們預計 2025 年的稅率約為 28% 至 29%。此外，我們在第二季度派發了每股 0.16 美元的季度股息。我們的董事會批准了下一季現金股息，每股0.16美元，將於2025年9月15日支付給2025年9月2日登記在冊的股東。

The company has now paid regular quarterly dividends dating back to 2006. Before we open the call for your questions, I would like to thank the entire Olympic Steel team for all their efforts in the second quarter. We know there are challenges and uncertainty, but we also know our business, our markets and our customers very well.

該公司自 2006 年以來一直按季度定期派發股息。在正式開始接受大家提問之前，我想感謝奧運鋼鐵隊全體隊員在第二季付出的所有努力。我們知道存在挑戰和不確定性，但我們也非常了解我們的業務、市場和客戶。

Our team is executing in a consistent and strategic manner that enables us to deliver these results and to continue to build shareholder value. Operator, we are now ready for questions.

我們的團隊以一致且具策略性的方式執行各項工作，使我們能夠取得這些成果，並持續為股東創造價值。操作員，我們現在可以接受提問了。

(Operator Instruction)

（操作說明）

Samuel McKinney, KeyBanc Capital Markets.

Samuel McKinney，KeyBanc Capital Markets。

Hey guys, good morning.

嘿，各位，早安。

Hi SAM.

嗨，SAM。

Thanks for the color earlier, Andrew, on some of the new equipment that you're getting in. I wanted to dive a little more into the new processing and automation equipment that's beginning to arrive.

安德魯，謝謝你之前介紹你們即將引進的一些新設備。我想更深入地了解一下正在陸續到貨的新型加工和自動化設備。

Just maybe talk a little more about the benefits that you'll see once those pieces start to contribute and if possible, quantify some of the benefits that you'll glean from those.

或許可以多談談這些部件開始發揮作用後您將看到的好處，如果可能的話，量化一下您將從中獲得的一些好處。

Yeah, Great question. Thanks, Sam. So this has been a project that has been years in making. The equipment is a combination of things, including high-speed lasers in addition to a whole (inaudible) system that allows us to move product throughout the building with very little touch from employees.

嗯，問得好。謝謝你，山姆。所以這個項目已經籌備多年了。該設備由多種部件組成，包括高速雷射以及一個完整的（聽不清楚的）系統，使我們能夠在建築物內移動產品，而員工幾乎無需接觸。

So part of the automation will be, number one, to improve safety so that we're touching the product less. And it will, at some point, reduce the number of employees that we have in that specific location as the automation gets going.

因此，自動化的一部分，第一，是為了提高安全性，從而減少我們與產品的接觸。隨著自動化進程的推進，我們遲早會減少在該特定地點的員工人數。

And then some of the other CapEx that Andrew talked about also really will enhance productivity. So maybe you could talk about some of the new cut-to-length lines and the slitter also. I think those are...

安德魯提到的其他一些資​​本支出也確實會提高生產力。所以，或許您可以談談一些新的定長切割生產線和分切機。我認為那些是…

Sure. So we have as you know, we have two cut-to-length lines. One is going into our Minneapolis facility. The other is going into our Schaumburg facility. The Schaumburg facility cut-to-length line will be primarily for aluminum. It's a very fast-growing product line for us, as you know, Sam.

當然。如您所知，我們有兩條定長切割生產線。其中一台將運往我們在明尼阿波利斯的工廠。另一台將運往我們在紹姆堡的工廠。紹姆堡工廠的定長切割生產線將主要用於鋁材。如你所知，薩姆，這是我們公司成長速度非常快的產品線。

The Minneapolis line is going to be a light gauge line. So going to be focusing a lot on galvanized and other tandem products as well as the new slitter that's going to be going into our Berlin operation. That won't be operational until the beginning of next year. But that is a very light gauge. So somewhere in the, call it, in the 0-10 range is what that will end up doing for us.

明尼阿波利斯線將採用輕軌技術。因此，我們將重點放在鍍鋅和其他串聯產品，以及即將投入柏林工廠的新型分條機。這項服務要到明年年初才能投入使用。但這只是很輕的量規。所以，最終它能為我們帶來的效果，大概在 0 到 10 的範圍內吧。

Yeah, then, Sam, in terms of kind of quantification, obviously, as Andrew said, most of the equipment is just becoming operational, call it, in the fourth quarter with the exception of the Berlin slitter, as you mentioned. So really, the ramp-up in terms of seeing the results in our results will be more towards next year.

是的，薩姆，就量化而言，顯然，正如安德魯所說，除了你提到的柏林分切機之外，大多數設備都將在第四季度投入使用。所以，要真正看到業績成效，可能要等到明年了。

As you know, we do a pretty rigorous process in terms of justification on CapEx and acquisitions. So we're pretty excited about the return profiles of all five of these big projects. But you'd start to see them phasing in early next year.

如您所知，我們在資本支出和收購的論點方面有著非常嚴格的流程。因此，我們對這五個大項目的回報前景感到非常興奮。但你會看到它們從明年年初開始逐步投入使用。

Thank you guys that was very helpful. And then it was great to see Pipe and Tube gross margins stay safely above that 30% mark. I know a component of that segment's profitability transformation over the last few years has been the OEM outsourcing fabrication work.

謝謝各位，這很有幫助。令人欣慰的是，管道和管材的毛利率一直穩定在 30% 以上。我知道，過去幾年該領域獲利能力轉變的一個組成部分是 OEM 外包製造工作。

Any more detail you can provide on the work you're doing for those OEMs, the incremental increase in interest since the tariff announcements or if some of that increase has also been on the carbon side?

您能否提供更多關於您為這些原始設備製造商 (OEM) 所做的工作的細節，例如自關稅公告發布以來，他們的興趣是否有所增加，或者其中一部分增長是否也與碳排放有關？

Well, the it has been a continuation of the customer kind of as on the flat-rolled side, Sam, where instead of supplying the tube, they're now looking for something else to be done. We have 19 high-speed tube lasers that are very active and going into a variety of industries. So very strong in the industrial OEMs and where we're really seeing an increase in that business has been in the data

嗯，這其實是客戶在扁平捲材方面業務的延續，Sam，他們現在不再是提供管材，而是尋求其他方面的服務。我們有 19 台高速管式雷射器，它們運作良好，並已應用於各個行業。因此，工業OEM廠商的業務非常強勁，我們在數據方面也確實看到了這部分業務的成長。

centers. We've seen significant growth on that side of it. And so whether it's in the Carbon side or even in the Stainless side for the Pipe and Tube, the growth has been pretty extraordinary on the fabrication.

中心。我們看到這方面有了顯著成長。因此，無論是碳鋼方面，或是不銹鋼管道方面，製造過程的成長都非常顯著。

Okay. And then last one for me. Obviously, first quarter demand with some pull forward. And then coming off the second quarter volume decline in Carbon Flat, how were trends in July? And how do you think things are shaping up for August?

好的。最後，也是我最後一個問題。顯然，第一季的需求會提前出現一些拉力。Carbon Flat 第二季銷售下滑後，7 月的趨勢如何？你覺得八月的狀況會如何？

Hey Sam, it's Rich. And I think what we typically see is this is a typical seasonal year, right? And what we've seen historically, say, over the last five to six years is third quarter is typically down 5% to 6% sequentially from Q2, and that's really all due kind of to the July holiday. The first two weeks of July typically are very slow and didn't see anything different this year than we typically see in other years.

嘿，山姆，我是里奇。我認為我們通常看到的是，這是一個典型的季節性年份，對吧？從過去五、六年的歷史來看，第三季通常比第二季環比下降 5% 到 6%，這實際上都是由於 7 月的假期造成的。7 月的前兩週通常是淡季，今年的情況與往年並無不同。

Okay, thanks guys and congrats on the solid quarter.

好的，謝謝大家，恭喜你們本季業績出色。

Thank you.

謝謝。

(Operator Instruction)

（操作說明）

Dave Storms with Stonegate Investment Group.

Dave Storms，來自 Stonegate Investment Group。

Morning everyone, and thank you for taking my questions. I just wanted to start with some of the flat-rolled margin improvements that you mentioned. How should we be thinking about maybe the main drivers of this margin improvement?

各位早安，感謝你們回答我的問題。我只想先談談您提到的一些關於平軋利潤率改進的問題。我們該如何看待利潤率提升的主要驅動因素？

David, it's Rich. And I think it was just really kind of a function of how the index pricing changed throughout the first half of the year. And so obviously, index pricing shot up after the announcements in February with the tariffs. We had secured some inventory at lower pricing. That allowed you to sell that at higher prices coming into the second quarter. That's essentially the margin improvement that you see based on index pricing.

大衛，我是里奇。我認為這實際上取決於今年上半年指數價格的變化。因此，很顯然，在2月宣布加徵關稅之後，指數價格飆升。我們以較低的價格採購了一些庫存。這樣一來，到了第二季度，你就可以以更高的價格出售這些產品了。這基本上就是基於指數定價所看到的利潤率提升。

Yes. And then the other thing I'd add this is Rick, Dave. The other thing I'd add is, obviously, we've talked a lot about it the last several years. Strategically, as we've also tried to enrich our mix. And when I say enrich our mix, it's everything, including on the Carbon side, doing more coated product, a product that carries a slightly higher pricing point and better margins. It's doing more fabricating and value-add work.

是的。還有一點我要補充的是，瑞克，戴夫。我還要補充一點，很顯然，過去幾年我們已經討論過很多次這個問題了。從策略角度來看，我們也嘗試豐富我們的產品組合。我說豐富我們的產品組合，指的是所有方面，包括在碳素方面，生產更多塗層產品，這類產品的價格略高，利潤也更好。它從事更多的製造和增值工作。

And a big piece of it is our acquisition strategy where we've gained diversification by owning some companies that make some end products. So it's all of that. And sometimes when the markets start to recede is the time you see the manifestation of that. And so I think that's part of what you're seeing aside from the basics in the service center pricing market and where the cost of the metal is.

其中很重要的一部分是我們的收購策略，我們透過擁有一些生產終端產品的公司實現了多元化。所以，這就是全部原因。而有時，當市場開始衰退時，你就會看到這種現象的體現。所以我認為，除了服務中心定價市場的基本因素和金屬成本之外，這就是你所看到的部分原因。

That's very helpful. I know you also mentioned in your prepared remarks, you're seeing some inbound inquiries jumping up, and that's a nice leading indicator. Are there any other leading indicators to maybe highlight, maybe some divergence in contracts for spot price, lead times extending, anything like that?

那很有幫助。我知道您在準備好的演講稿中也提到，您看到一些來電諮詢量激增，這是一個很好的先行指標。還有其他需要重點關注的領先指標嗎？例如現貨價格合約出現分歧、交貨週期延長等等？

No. I think from my perspective, as I take a little bit of a longer view, I think getting some of the uncertainties settled out of Washington, D.C. will be helpful. So I think we checked the box on the tax legislation. So that's a good thing. The tariffs are still as evidenced by last night, all the announcements, the tariffs are still in flux. Hopefully, we get some resolution on those in the near term. We do like, and Andrew talked about it, continue to see really strong quoting on fabricating and outsourced value-add work from a lot

不。從我的角度來看，從長遠角度來看，我認為消除華盛頓特區的一些不確定因素將會有所幫助。所以我覺得我們在稅收立法方面已經完成任務了。這是件好事。從昨晚的所有公告來看，關稅政策仍然處於變動之中。希望這些問題能在短期內解決。我們確實很喜歡這一點，安德魯也談到了這一點，我們繼續看到許多公司在製造和外包增值工作方面提供非常強勁的報價。

of our OEMs. And I think that's really a continuation from what we've talked about as far back as coming out of COVID. So we see that.

我們的原始設備製造商。我認為這實際上是我們自新冠疫情爆發以來一直在討論的內容的延續。我們看到了這一點。

Andrew mentioned some strength in data center business, which we're a big participant in, in really many of our divisions and many of our products. So those would be some of the positives. I think it's always July, as Rich said, July is always more of a muted seasonally slow month, and we obviously saw that this year. But it will be good moving into August. I think we'll see some normal pickup in business. But yes, that's what we see. And then I'd tell you, the general backdrop hasn't changed though that much.

Andrew提到我們在資料中心業務方面實力雄厚，而我們正是資料中心業務的重要參與者，我們的許多部門和許多產品都涉及資料中心業務。以上就是一些正面的方面。我認為總是七月，正如 Rich 所說，七月總是比較平靜的季節性淡季，我們今年顯然也看到了這一點。但進入八月將會是件好事。我認為我們會看到商業活動出現一些正常的回暖跡象。是的，我們看到的就是這樣。然後我會告訴你，整體背景並沒有太大變化。

That's very informative. And then just one more for me, if I could. You mentioned that comment to check in the box on tax legislation, hoping to spend a little more time there. Any other impacts from the tax legislation other than maybe just the bonus depreciation that could work as a tailwind for you guys? Anything else there that you're keeping your eye on as it evolves?

這很有幫助。如果可以的話，再給自己留一個吧。你提到那則評論是為了在稅收立法方面打勾，希望能多花點時間在那方面。除了額外折舊之外，稅法還有其他影響可能對你們有利嗎？還有其他什麼方面是你有在關注的嗎？

That well, why don't you answer for Olympic and then we can also talk about why it's good for our business in terms of the bonus depreciation.

那好，不如你先代表奧運隊回答一下，然後我們再來談談為什麼這對我們的業務，特別是獎金折舊方面，是有利的。

Yeah, absolutely, Dave. So it's Rich. Yes, I think the bonus depreciation of anything is the most significant part of the tax legislation. This has happened a number of times over, say, the last decade through various tax legislation, and it's very helpful to our customer base.

是的，沒錯，戴夫。所以它很富有。是的，我認為任何資產的額外折舊都是稅法中最重要的一部分。在過去十年中，透過各種稅收立法，這種情況已經發生過好幾次了，這對我們的客戶群非常有幫助。

So for us, it will obviously allow us to depreciate some of the projects that not the current projects, but any projects that we've entered into after January of 2025 on a faster basis. But I think the bigger impact really is our customer base that really does help kind of the OEMs and their customer base feel the helps drive demand, which is always good for us and good for the industry.

因此，對我們來說，這顯然可以讓我們更快地對一些項目進行折舊，這些項目不是目前的項目，而是我們在 2025 年 1 月之後開始的任何項目。但我認為更大的影響在於我們的客戶群，這確實有助於 OEM 及其客戶群感受到需求，從而推動需求成長，這對我們和整個產業來說都是好事。

Yeah, I think the depreciation deductibility for customers, when you combine that with when we start to see interest rates come down, whenever that will be, those two things, I think, will be a pretty powerful boost to demand. So we've got part of the equation in place, but the bigger part is really the interest rates.

是的，我認為，當客戶的折舊抵扣政策與利率開始下降（無論何時）結合時，這兩件事將對需求產生相當大的推動作用。所以我們已經解決了一部分問題，但更重要的部分其實是利率。

Understood thank you for the time and good luck in Q3.

明白了，謝謝您抽出時間，祝您第三季一切順利。

(Operator Instruction)

（操作說明）

Christopher Sakai, Singular Research.

Christopher Sakai，Singular Research。

Yes, hi, good morning.

是的，你好，早安。

Hi, Chris.

嗨，克里斯。

Can you talk about the gross margin in Carbon Flat? Looks like it improved year-over-year. What initiatives really helped that improvement?

能談談Carbon Flat的毛利率嗎？看起來比去年有進步。哪些措施真正促進了這種改善？

Hey Chris, it's Rich. And I think Rick had addressed a couple of those on the last question. But I think that what you saw was a combination of an increase in index pricing. You saw the better mix that we've had. As Rick indicated, we've got a better concentration in some higher-margin products.

嘿，克里斯，我是里奇。我認為里克在上一個問題中已經回答了其中幾個問題。但我認為你看到的是指數價格上漲的綜合結果。你看到了我們迄今為止更好的組合。正如里克所指出的，我們在一些高利潤產品上的投入更加集中。

It's the focus on fabrication. And I'll give a shout out to our end products companies who did have a very strong second quarter. All of that combined to help that gross margin on the Carbon side.

重點在於製造。我還要特別表揚一下我們的終端產品公司，他們第二季的業績非常強勁。所有這些因素加在一起，有助於提高碳業務的毛利率。

Okay, great. Can you talk about operating expenses? What should we be expecting for for the rest of the year and operating expenses?

好的，太好了。能否談談營運費用？今年剩餘時間的營運費用和預期情況如何？

Yeah, Chris, I mean, I think what you saw is operating expenses were relatively flat in Q2 versus Q1, and you know what we TRY to do is make sure that those operating expenses move on a variable basis with with volume. We did in an earlier question say that, typically Q3 is seasonally slower than Q2. With that we'd expect to take the operating expenses down commensurately with volume.

是的，克里斯，我的意思是，我認為你看到的是第二季度的營運費用與第一季相比基本上持平，你知道我們努力的目標是確保這些營運費用隨著銷售的變化而變化。我們在先前的問題中提到過，通常情況下，第三季會比第二季略微放緩。這樣一來，我們預計營運成本將隨著銷售量的增加而相應降低。

Can you talk about do you have an outlook for the pricing for hot-rolled steel in the second half of the year? Do you see any stabilization there?

您能否談談您對今年下半年熱軋鋼材價格的預期？你看到那裡的局勢有任何穩定跡象嗎？

Yeah, Chris, this is Andrew. I think you'll see the second half of the year is going to be similar to what you'll see what we saw in the first half. I think there are some variables that could change that. Certainly, you have a 50% tariff.

是的，克里斯，這是安德魯。我認為你會發現下半年的情況會和上半年類似。我認為有一些因素可能會改變這種情況。當然，你們要繳50%的關稅。

If the tariff is reduced, as you know, it went from 25% to 50% if it's reduced back to 25%, if the tariff is replaced by a quota and the economy stays at least with our customers, the way that we see it, you could see some pressure. But barring that, I think you're going to see some stability for the second half of the year.

如您所知，如果關稅降低，它從 25% 升至 50%，如果降回 25%，如果關稅被配額制取代，並且經濟至少維持在我們的客戶群體中，我們認為，可能會出現一些壓力。但除此之外，我認為下半年市場會保持穩定。

Okay. And last one, this is more of a macro question, but we're seeing some large investments from other countries like Japan and Europe from these tariff deals. Is that going to be affecting demand?

好的。最後一個問題，這更多的是一個宏觀問題，但我們看到，透過這些關稅協議，日本和歐洲等其他國家進行了一些大規模投資。這會影響需求嗎？

Chris, this is Andrew. I think it's a little early to tell. There have been a lot of numbers that have been reported, I would say, soft on specifics. And I think the more manufacturing that can come to the United States, the better it's going to be for the United States and certainly the steel industry. And so we're encouraged by the news out of Washington and the tariff deals that have been made that's talking about countries investing in the US and the building and potential opportunities for us and manufacturing in general.

克里斯，這是安德魯。我覺得現在下結論還太早。已經報導了很多數字，但我覺得這些數字在具體細節上都比較模糊。我認為，製造業越能轉移到美國，對美國就越有利，對鋼鐵業當然也越有利。因此，我們對來自華盛頓的消息以及已經達成的關稅協議感到鼓舞，這些協議談到了各國在美國的投資，以及為我們和整個製造業帶來的建設和潛在機會。

Okay, great. Thanks for the answers.

好的，太好了。謝謝大家的解答。

(Operator Instruction)

（操作說明）

Philip Gibbs, KeyBanc Capital Markets.

Philip Gibbs，KeyBanc Capital Markets。

Hey, good morning.

嘿，早安。

Good morning, Philip.

早安，菲利普。

I know there was a question earlier about the big beautiful bill. Are there actual discrete tax benefits that you all will realize in the second half of '25, given a lot of the investments you're putting in place this year?

我知道之前有人問過關於那張巨額帳單的問題。考慮到你們今年投入的大量投資，在 2025 年下半年你們能否獲得實際的、具體的稅收優惠？

Hey Phil, it's Rich. Yes, unfortunately, we went forward with this large organic growth these opportunities before January of 2025, which that's the cutoff date for those. So we will not get the bonus depreciation on those. But yes, future projects, we certainly will look to get that benefit, but I do not expect to have a significant impact on the 2025 tax rate.

嘿，菲爾，我是里奇。是的，很遺憾，我們在 2025 年 1 月之前就推進了這些大規模的有機成長機會，而 2025 年 1 月是這些機會的截止日期。因此，我們將無法獲得這些項目的額外折舊。是的，未來的項目我們肯定會尋求獲得這種好處，但我預計不會對 2025 年的稅率產生重大影響。

Okay. And then regarding that working capital, typically, the second half is a source of cash for you all. I know the pricing has been kind of been volatile across products, but you typically do have a second half tailwind and cash inflow associated with that. What are you expecting this year?

好的。至於營運資金，通常情況下，後半部是你們大家的現金來源。我知道各產品的價格一直波動較大，但通常下半年都會有利因素和相應的現金流入。對今年有什麼期待？

Yeah,Phil, I think we're evaluating that right now. I think the thing that has changed since we had the last call was that the 25% base increase in stainless pricing. So we're evaluating some opportunities in stainless. And so my outlook right now for Q3 is probably more flattish on debt than a paydown.

是的，菲爾，我想我們現在正在評估這件事。我認為自上次通話以來發生的變化是，不銹鋼價格的基本漲幅為 25%。所以我們正在評估不銹鋼領域的一些機會。因此，我目前對第三季的展望可能是債務水準保持平穩，而不是減少。

And then in Q4, you typically will still get that release?

那麼到了第四季度，通常還能看到這個版本發布嗎？

Well, we'll see where pricing goes. So I'm going quarter-by-quarter right now. And so based on what I know, I think we're flattish for Q3.

我們拭目以待價格走勢。所以我現在是按季來算的。因此，根據我所了解的情況，我認為第三季業績將基本持平。

Okay. And then lastly, mentioned have over $300 million of liquidity available to you all. I know M&A has been a big part of your strategy over the last several years. Are there still a swath of decent opportunities out there that you that you could be exploring?

好的。最後，我還要提到，我們有超過 3 億美元的流動資金可供大家使用。我知道在過去幾年裡，併購一直是你們策略的重要組成部分。是否還有大量不錯的機會值得你去探索？

Yeah, Phil, great question. It's Rick. Really, we saw the opportunity flow really slowed down towards the end of last year and through the first quarter. We've seen it pick up in the second quarter. So we're certainly seeing and looking at more things. Obviously, as we've stated every quarter, M&A is still a big piece of our strategy in addition to the pretty large CapEx plan we went through for this year.

是的，菲爾，問得好。是里克。實際上，我們看到去年年底和今年第一季機會的流入明顯放緩了。我們看到第二季情況有所改善。所以我們當然看到並關注到更多的事情了。顯然，正如我們每個季度都強調的那樣，除了我們今年實施的相當龐大的資本支出計劃之外，併購仍然是我們策略的重要組成部分。

So we're actively looking. I think we're starting to see some better candidates that really fit our target zone. So more to come on that as we work through the third quarter. But the good news is, I think that little bit of a hesitation and pause that we saw for, call it, three or four months seems to start to be that logjam of nothing happening seems to be opening up a bit.

所以我們正在積極尋找合適的人選。我認為我們開始看到一些更符合我們目標群體的優秀候選人。所以，隨著第三季的進行，我們還會對此進行更多探討。但好消息是，我認為我們之前看到的持續了三、四個月的猶豫和停滯似乎開始有所緩解，這種停滯不前的局面似乎正在逐漸打破。

So we'll continue to be active. We're looking at a lot of things, and we'll continue to be disciplined, too, Phil. We've said it many times, while growth through a combination of organic growth and our CapEx and acquisition is the way forward for us strategically, we're going to stay disciplined, and we're not going to make an acquisition just to say we have to make an acquisition because it's been a couple of quarters.

所以我們會繼續保持活躍。我們正在考慮很多事情，而且我們也會繼續保持自律，菲爾。我們已經多次說過，雖然透過內生成長、資本支出和收購相結合的方式實現成長是我們未來的策略方向，但我們將保持自律，不會僅僅因為過了幾個季度就為了收購而收購。

But I'm optimistic as we work through the back half that we'll continue to see some really good fits for Olympic.

但我很樂觀，隨著下半程的進行，我們將繼續看到一些非常適合奧運的球員。

Thank you.

謝謝。

We have reached the end of the question-and-answer session. I'd now like to turn the call back over to Rick Marabito for closing comments.

問答環節到此結束。現在我想把電話轉回給里克·馬拉比托，請他做總結發言。

Thank you, operator. And I just want to thank all of you for joining us today on our call. We appreciate your continued interest in Olympic Steel, and we look forward to speaking with you again next quarter. Thank you, and everyone, have a great day.

謝謝接線生。最後，我要感謝各位今天參加我們的電話會議。感謝您一直以來對奧林匹克鋼鐵的關注，我們期待下個季度再次與您洽談。謝謝大家，祝大家今天過得愉快。

This concludes today's conference. You may disconnect your lines at this time, and we thank you for your participation.

今天的會議到此結束。現在您可以斷開線路了，感謝您的配合。