More annual reports from Reliance Steel & Aluminum:
2023 ReportPeers and competitors of Reliance Steel & Aluminum:
Steel DynamicsToward a Better Tomorrow R E L I A N C E S T E E L & A L U M I N U M C O . 2 0 1 6 A N N U A L R E P O R T Reliance Steel & Aluminum Co. 2016 Annual Report 1 2 Stay invested and committed to the things that matter most and you will weather any storm along the journey. 1 3 Committed to the people we call family 4 Applying stringent acquisition criteria ensures that our Family of Companies grows strategically, sustainably, and profitably. Since our IPO in 1994, Reliance has completed 62 acquisitions. Today, we are one company comprised of over 70 distinct brands. Both the individual and combined strengths of our Family of Companies make Reliance the industry leader. Our success is built on safeguarding our most important assets – our employees – and, in turn, our employees’ ability to successfully execute our corporate strategy. This was demonstrated in 2016, when we reduced recordable safety incidents by over 25% compared to 2015 and simultaneously achieved record gross profit margins. 5 Over the past six years, Reliance has strategically invested over $1 billion in capital expenditures – including $154.9 million in 2016. Our investments in cutting-edge plasma and laser technologies have enabled us to perform higher levels of value-added processing with shorter lead times: wins for us and for our customers. In 2016, we performed value-added processing on approximately 47% of our orders. Reliance possesses the technological skills to satisfy today’s business requirements. We stand poised to meet the increase in orders as the various end markets we service continue to rebound. 6 Invested in value-added technology 7 Focused on increasing stockholder value 8 9 Even in challenging times, Reliance continues to deliver quality products and services – and does so profitably – thanks to the expertise of our management and solid execution by our workforce. Our operational agility helps us navigate volatile metals pricing, changing market conditions, and fluctuations at any point along our supply chain. The results: a strong corporate balance sheet and consistent returns to our stockholders. We remain focused on our balanced capital allocation strategy: growth through acquisitions and organic investments, while also providing meaningful stockholder returns. This includes quarterly cash dividends, which Reliance has paid for 57 consecutive years. In 2016, we increased our dividend – for the 24th time since our IPO – 5.9% to $0.45 per share. 9 Fellow Stockholders Operationally, 2016 was a terrific year for Reliance. Our actions in the United States reduced import levels, focus on maximizing gross profit margin resulted in creating an environment in which the domestic mills our first-ever annual gross profit margin above 30%. were able to increase metal prices for certain products. In 2015 we concentrated on right-sizing our overall However, the overall pricing environment was volatile inventory position, which resulted in record cash flow throughout the year, causing our average selling price to from operations of $1 billion. In both 2015 and 2016, we decrease 6.8% in 2016 compared to 2015. Our focus on increased our focus on properly pricing our products and gross profit margin, however, allowed us to realize a 600 services to reflect the value we provide to our customers. basis point improvement in our FIFO gross profit margin, These actions contributed to our higher gross profit from 25.1% in the fourth quarter of 2014 to a peak of 31.1% in margin and strong cash flow that allowed us to continue the second quarter of 2016. Our higher gross profit margin executing our growth strategy while also providing in 2016 resulted in $328 million more gross profit dollars meaningful stockholder returns. despite a $737 million decline in sales. The increased gross profit dollars, along with effective expense control Our growth strategy focuses on increasing our value- and working capital management, allowed Reliance to added processing capabilities as well as our offerings of deliver earnings per share of $4.16, consistent with 2015 specialty products, both of which support higher gross despite reduced volume and pricing. profit margins. We have made significant investments in value-added processing equipment over the past six Customer demand remained generally healthy in 2016, years, spending $1 billion on capital expenditures, most outside of the energy and heavy industry end markets. of which were growth related. In 2016 we acquired three Our same-store tons sold declined by only 2.7%, companies, each of which provides high levels of value- once again outperforming the 6.2% industry average added processing or specialty products. decline reported by the Metals Service Center Institute (MSCI). While overall demand for metal products was In 2016, our total sales were $8.6 billion, down 7.9% from not as strong as we expected when we entered 2016, our 2015 total sales of $9.4 billion, primarily due to lower customer sentiment has improved and we anticipate metal prices, especially for carbon steel products. Trade improving demand levels as we move through 2017. James D. Hoffman, Executive Vice President and Chief Operating Officer | Karla R. Lewis, Senior Executive Vice President and Chief Financial Officer Gregg J. Mollins, President and Chief Executive Officer 10 11 We believe our decentralized operating structure helps demand also remains solid. 2017 marks the beginning of us increase our market share by allowing us to focus on our involvement with the five-year, $350 million Joint Strike fulfilling small order sizes for the bulk of our customers Fighter program, further strengthening our already strong who purchase product in smaller quantities on a much position in the aerospace and defense markets. more frequent basis. Our 2016 average order size was only $1,560, and we delivered approximately 40% of our We have also performed well servicing the non-residential orders within 24 hours or less, a competitive advantage construction market as it continues its gradual recovery, of which we are very proud. Our investments in value- and we are encouraged by early signs of recovery in added processing equipment have also contributed to the energy market. As the downturn in oil prices and our increased market share, as we believe we are able drilling activity began toward the end of 2014, Reliance to provide a higher quality product to our customers proactively addressed declines in this market through than many of our competitors. In 2016, we performed facility closures and asset write-downs on certain of our value-added processing services on 47% of our orders, businesses. We believe we are now well positioned to compared to our historical rate of 40%. Further, we believe participate in any recovery. an efficient inventory position benefits our gross profit margin by allowing us to focus on higher margin business. Maintaining a solid overall liquidity position remains a continual focus for us, providing the flexibility and resources We also believe our exposure to a broad array of products to continue growing our business both organically and and end markets helps mitigate declines in any one through acquisition opportunities. We will also continue market. Demand for automotive remains healthy at current to prioritize returning value to our stockholders through production rates. We began processing aluminum for the increased dividend payments and opportunistic share auto industry in 2015, mainly through our toll-processing repurchases. In 2016, we continued our balanced capital operations in the U.S. and Mexico, and since then have allocation strategy, using our strong cash flow from expanded our processing volume and capital investments operations to fund $348.7 million in acquisitions, $154.9 in this area, due to the increased usage of aluminum million of capital expenditures, and $120.4 million in in automotive. We expect that our investments in both dividends. We have paid regular quarterly dividends for 57 facilities and equipment will drive further increases in consecutive years and have increased the dividend 24 times aluminum volume processed in 2017 versus our record since our IPO in 1994, including our most recent increase levels attained in 2016. In the aerospace market, overall of 5.9% to $0.45 per share, in the first quarter of 2017. 12 13 The Reliance Family of Companies welcomed three new practices implemented by our managers in the field businesses in 2016, bringing our total acquisition count have enabled Reliance to thrive through all types of to 62 quality companies since our 1994 IPO. Each of environments. We are also very pleased with Reliance’s these companies fits our overall strategy for growth in safety performance in 2016, in which our companies specialty and high-margin products and services, and achieved a year-over-year reduction in our incident was accretive to our earnings. The acquisition of Tubular rate of more than 25%. We would like to thank all of our Steel expands our presence in specialty products and employees for working hard, and for doing so safely. We strengthens our foothold in the energy end-market. would also like to thank our loyal customers, suppliers, and Although current activity levels are lower than normal, stockholders for their continued support and commitment we are confident in the long-term strength of the energy to Reliance. In the coming year, we anticipate a renewed market and Tubular Steel’s ability to benefit during enthusiasm for infrastructure and equipment spending, the recovery. Best Manufacturing increases our high- as well as improvement in the energy market. As we look margin, value-added processing capabilities; and Alaska “toward a better tomorrow,” we believe Reliance is very Steel marks our first entry into the Alaskan market, well positioned to capitalize on these opportunities. broadening our reach and servicing diverse industries, including infrastructure and energy. We are continuously evaluating well-run companies that fit our strategy for profitable growth and meet our stringent acquisition criteria. At the same time, we remain focused on organic investment – primarily in state-of- the-art, value-added processing equipment – that will continue to enhance our earnings. On behalf of Reliance, we would like to express how extremely proud we are of the strong operational performance and commitment shown by our more than 14,000 employees. In particular, the strict pricing discipline Gregg J. Mollins | President and Chief Executive Officer Karla R. Lewis | Senior Executive Vice President and Chief Financial Officer and diligent expense and inventory management James D. Hoffman | Executive Vice President and Chief Operating Officer 13 Geographic Presence 2016 Sales S TATE S Alabama Florida Kentucky Georgia Louisiana Alaska Arizona Arkansas California Colorado Montana Nevada Ohio Oklahoma Utah Virginia Idaho Illinois Maryland New Hampshire Oregon Washington Massachusetts New Jersey Pennsylvania Wisconsin Indiana Michigan New Mexico South Carolina Iowa Minnesota New York Tennessee Connecticut Kansas Missouri North Carolina Texas I NTE R N ATI O N A L Australia Mexico Belgium Singapore Canada South Korea China France India Malaysia Turkey United Arab Emirates United Kingdom 14 15 2016 Sales BY R E G I O N BY CO M M O D IT Y BY PR O D U C T Carbon steel plate Carbon steel structurals Carbon steel tubing Carbon steel bar Heat-treated aluminum plate Aluminum bar & tube Stainless steel bar & tube Stainless steel sheet & coil Miscellaneous, including brass, copper & titanium Hot-rolled steel sheet & coil Galvanized steel sheet & coil Common alloy aluminum sheet & coil Alloy bar, rod & tube Toll processing of aluminum, carbon & stainless steel Cold-rolled steel sheet & coil Stainless steel plate Common alloy aluminum plate Heat-treated aluminum sheet & coil Alloy plate, sheet & coil 10% 10% 10% 7% 7% 6% 6% 6% 6% 6% 6% 5% 4% 3% 3% 2% 1% 1% 1% M I DW E S T 3 2 % S O U T H E A S T 1 7 % W E S T/S O U T H W E S T 1 2 % C A L I F O R N I A 1 0 % I N T E R N AT I O N A L 9 % M I D - AT L A N T I C 7 % N O R T H E A S T 6% PAC I F I C N O R T H W E S T 4% C A R B O N S T E E L 52 % A LU M I N U M 2 0 % S TA I N L E S S S T E E L 1 4% OT H E R 6% A L LOY 5% M O U N TA I N 3 % TO L L P R O C E S S I N G 3 % 15 16 17 $10,451.6 $403.5 $1,025.0 $9,223.8 $9,350.5 $8,442.3 $8,613.4 $371.5 $321.6 $311.5 $304.3 $601.9 $633.3 $626.5 $356.0 2012 2013 2014 2015 2016 2012 2013 2014 2015 2016 2012 2013 2014 2015 2016 N E T S A LE S ( I N M I L L I O N S ) N E T I N CO M E ( I N M I L L I O N S ) C A S H F LOW F R O M O PE R ATI O N S ( I N M I L L I O N S ) 13% $5.33 10% 9% 8% 8% $4.73 $4.14 $4.16 $4.16 2012 2013 2014 2015 2016 2012 2013 2014 2015 2016 R E TU R N O N E Q U IT Y E A R N I N G S PE R S H A R E ( D I L U T E D ) 17 (1) Gross profit, calculated as net sales less cost of sales, is a non-GAAP financial measure as it excludes depreciation and amortization expense associated with the corresponding sales. The majority of our orders are basic distribution with no processing services performed. For the remainder of our sales orders, we perform “first- stage” processing, which is generally not labor intensive as we are simply cutting the metal to size. Because of this, the amount of related labor and overhead, including depreciation and amortization, is not significant and is excluded from our cost of sales. Therefore, our cost of sales is substantially comprised of the cost of the material we sell. We use gross profit as shown above as a measure of operating performance. Gross profit is an important operating and financial measure, as fluctuations in our gross profit can have a significant impact on our earnings. Gross profit, as presented, is not necessarily comparable with similarly titled measures for other companies. (2) Long-term debt includes the long-term portion of capital lease obligations. SELECTED CONSO LIDAT ED FIN A NC IA L DATA In millions, except share and per share data Year Ended December 31, Income Statement Data: Net sales 2016 2015 2014 2013 2012 $8,613.4 $9,350.5 $10,451.6 $9,223.8 $8,442.3 Cost of sales (exclusive of depreciation and amortization expense) 6,023.1 6,803.6 7,830.6 6,826.2 6,235.4 Gross profit(1) 2,590.3 2,546.9 2,621.0 2,397.6 2,206.9 Warehouse, delivery, selling, general and administrative expense 1,803.3 1,728.5 1,789.8 1,638.4 1,396.2 Depreciation and amortization expense Impairment of long-lived assets Operating income Other income (expense): Interest expense Other income (expense), net Income before income taxes Provision for income taxes Net income Less: Net income attributable to noncontrolling interests 222.0 52.4 218.5 53.3 213.8 – 192.4 14.9 149.0 2.5 512.6 546.6 617.4 551.9 659.2 (84.6) (84.3) 1.2 429.2 120.1 309.1 4.8 (3.6) 458.7 142.5 316.2 4.7 (81.9) 10.8 546.3 170.0 376.3 4.8 (77.5) (58.4) 3.9 8.6 478.3 153.6 324.7 3.1 609.4 201.1 408.3 4.8 Net income attributable to Reliance $304.3 $311.5 $371.5 $321.6 $403.5 Earnings Per Share: Diluted Basic $4.16 $4.21 $4.16 $4.20 $4.73 $4.78 $4.14 $4.19 $5.33 $5.36 Weighted average shares outstanding – diluted 73,120,918 74,902,064 78,615,939 77,646,192 75,694,212 Weighted average shares outstanding – basic 72,362,513 74,096,349 77,682,943 76,844,912 75,216,955 Other Data: Cash flow provided by operations $626.5 $1,025.0 $356.0 $633.3 $601.9 Capital expenditures Cash dividends per share Balance Sheet Data (December 31): Working capital Total assets Short-term debt Long-term debt(2) 154.9 1.65 172.2 1.60 190.4 1.40 168.0 1.26 214.0 0.80 $2,032.5 $1,564.5 $2,458.3 $2,165.5 $1,699.2 7,411.3 7,121.6 7,822.4 7,323.6 5,846.7 82.5 500.8 93.9 36.5 83.6 1,847.2 1,428.9 2,209.6 2,055.1 1,113.0 Reliance stockholders' equity 4,148.8 3,914.1 4,099.0 3,874.6 3,558.4 18 19 SEL ECTED CONS OLIDATE D FI NA NC I AL DATA Amounts in millions, except per share data Year Ended December 31, 2016 2015 2014 2013 2012 2011 2010 2009 2008 2007 2006 Income Statement Data: Net sales Operating income(1) Net income attributable to Reliance Pretax income(2) Income taxes Weighted average shares outstanding – diluted Balance Sheet Data: Current assets Working capital Net fixed assets Total assets(3) Current liabilities Short-term debt Long-term debt(3) Total Reliance stockholders’ equity Per Share Data: Earnings – diluted Dividends Book value(4) Ratio Analysis: Return on Reliance stockholders’ equity(5) Current ratio Net debt-to-total capital ratio(6) Gross profit margin(7) Operating income margin(1) Pretax income margin(2) Net income margin – Reliance $8,613.4 $9,350.5 $10,451.6 $9,223.8 $8,442.3 $8,134.7 $6,312.8 $5,318.1 $8,718.8 $7,255.7 $5,742.6 512.6 304.3 429.2 120.1 546.6 311.5 458.7 142.5 617.4 371.5 546.3 170.0 551.9 321.6 478.3 153.6 659.2 403.5 609.4 201.1 572.8 343.8 511.6 162.4 360.7 194.4 296.5 98.6 250.4 148.2 195.5 46.3 853.0 482.8 766.6 282.9 723.5 408.0 654.7 246.4 627.4 354.5 571.4 216.6 73.1 74.9 78.6 77.6 75.7 75.0 74.5 73.7 73.6 76.1 73.6 $2,688.5 $2,554.2 $2,738.9 $2,277.4 $2,274.7 $1,700.9 $1,390.9 $2,302.4 $1,721.4 $1,675.4 2,032.5 1,662.2 7,411.3 656.0 82.5 1,846.7 4,148.8 $4.16 $1.65 $57.07 7.8% 4.1 30.3% 30.1% 6.0% 5.0% 3.5% 1,564.5 1,635.5 7,121.6 989.7 500.8 1,428.9 3,914.1 $3,121.1 2,458.3 1,656.4 7,822.4 662.8 93.9 2,209.6 4,099.0 2,165.5 1,603.9 7,323.6 573.4 36.5 2,055.1 3,874.6 $4.16 $1.60 $4.73 $1.40 $4.14 $1.26 $54.59 $53.03 $49.99 8.0% 2.6 31.8% 27.2% 5.8% 4.9% 3.3% 20 9.6% 4.7 34.9% 25.1% 5.9% 5.2% 3.6% 9.0% 4.8 34.1% 26.0% 6.0% 5.2% 3.5% 1,699.2 1,240.7 5,846.7 578.2 83.6 1,113.0 3,558.4 $5.33 $0.80 $46.82 12.8% 3.9 23.6% 26.1% 7.8% 7.2% 4.8% 1,698.3 1,105.5 5,592.3 576.4 12.2 1,306.9 3,143.9 $4.58 $0.48 $41.92 12.2% 3.9 28.2% 24.4% 7.0% 6.3% 4.2% 2,823.7 2,606.4 1,192.3 1,025.3 4,659.1 508.6 86.2 848.0 $2.61 $0.40 $37.83 7.5% 3.3 23.3% 25.1% 5.7% 4.7% 3.1% 973.3 981.3 4,293.5 417.6 86.4 839.3 $2.01 $0.40 $35.34 6.1% 3.3 25.3% 26.3% 4.7% 3.7% 2.8% 1,652.2 998.7 5,184.8 650.2 93.9 1,664.9 2,431.4 $6.56 $0.40 $33.17 22.9% 3.5 41.3% 24.8% 9.8% 8.8% 5.5% 3,974.2 3,604.4 1,121.5 824.6 599.9 71.8 1,004.0 2,106.2 $5.36 $0.32 $28.12 23.4% 2.9 32.2% 25.3% 10.0% 9.0% 5.6% 1,124.7 742.7 550.7 22.3 1,078.3 1,746.4 $4.82 $0.22 $23.07 27.3% 3.0 37.4% 26.3% 10.9% 10.0% 6.2% 21 SELECTED CONSOL IDATED FI NAN C I AL DATA Amounts in millions, except per share data Year Ended December 31, 2016 2015 2014 2013 2012 2011 2010 2009 2008 2007 2006 (1) Operating income represents net sales less cost of sales, warehouse, delivery, selling, Income Statement Data: Net sales Operating income(1) Net income attributable to Reliance Pretax income(2) Income taxes Weighted average shares outstanding – diluted Balance Sheet Data: Current assets Working capital Net fixed assets Total assets(3) Current liabilities Short-term debt Long-term debt(3) Per Share Data: Earnings – diluted Dividends Book value(4) Ratio Analysis: Total Reliance stockholders’ equity Return on Reliance stockholders’ equity(5) Current ratio Net debt-to-total capital ratio(6) Gross profit margin(7) Operating income margin(1) Pretax income margin(2) Net income margin – Reliance 617.4 371.5 546.3 170.0 $3,121.1 2,458.3 1,656.4 7,822.4 662.8 93.9 2,209.6 4,099.0 9.6% 4.7 34.9% 25.1% 5.9% 5.2% 3.6% 2,032.5 1,662.2 7,411.3 656.0 82.5 1,846.7 4,148.8 $4.16 $1.65 $57.07 7.8% 4.1 30.3% 30.1% 6.0% 5.0% 3.5% 1,564.5 1,635.5 7,121.6 989.7 500.8 1,428.9 3,914.1 8.0% 2.6 31.8% 27.2% 5.8% 4.9% 3.3% $4.16 $1.60 $4.73 $1.40 $4.14 $1.26 $54.59 $53.03 $49.99 2,165.5 1,603.9 7,323.6 573.4 36.5 2,055.1 3,874.6 9.0% 4.8 34.1% 26.0% 6.0% 5.2% 3.5% 1,699.2 1,240.7 5,846.7 578.2 83.6 1,113.0 3,558.4 $5.33 $0.80 $46.82 12.8% 3.9 23.6% 26.1% 7.8% 7.2% 4.8% 1,698.3 1,105.5 5,592.3 576.4 12.2 1,306.9 3,143.9 $4.58 $0.48 $41.92 12.2% 3.9 28.2% 24.4% 7.0% 6.3% 4.2% $8,613.4 $9,350.5 $10,451.6 $9,223.8 $8,442.3 $8,134.7 $6,312.8 $5,318.1 $8,718.8 $7,255.7 $5,742.6 512.6 304.3 429.2 120.1 546.6 311.5 458.7 142.5 551.9 321.6 478.3 153.6 659.2 403.5 609.4 201.1 572.8 343.8 511.6 162.4 360.7 194.4 296.5 98.6 250.4 148.2 195.5 46.3 853.0 482.8 766.6 282.9 723.5 408.0 654.7 246.4 627.4 354.5 571.4 216.6 73.1 74.9 78.6 77.6 75.7 75.0 74.5 73.7 73.6 76.1 73.6 $2,688.5 $2,554.2 $2,738.9 $2,277.4 $2,274.7 $1,700.9 $1,390.9 $2,302.4 $1,721.4 $1,675.4 general and administrative expense, and depreciation and amortization expense. Certain reclassifications were made to 2007 and prior years to include amortization expense in the calculation of Operating income. In 2016, 2015, 2014, 2013 and 2012, the calculation of Operating income includes various non-recurring charges and credits, including impairment charges in 2016, 2015, 2013 and 2012. (2) The adoption of accounting rule changes in 2009 affected the presentation of noncontrolling interests. Prior year pretax income and margin amounts have been retrospectively adjusted to conform to the current presentation. (3) Long-term debt includes the long-term portion of capital lease obligations. The adoption of accounting rule changes in 2015 affected the presentation of debt issuance costs. Prior year Total assets and Long-term debt amounts have been retrospectively adjusted to conform to the current presentation. (4) Book value per share is calculated as Reliance stockholders’ equity divided by number of common shares outstanding as of December 31 of each year. (5) Return on Reliance stockholders’ equity is based on the beginning of year equity amount, except for 2015, which is adjusted for $355.5 million of share 1,121.5 824.6 1,124.7 742.7 3,974.2 3,604.4 repurchases, and 2006 which is adjusted for a 2006 acquisition using $360.5 million of common stock as consideration. (6) Net debt-to-total capital ratio is calculated as total debt (net of cash) divided by Reliance stockholders’ equity plus total debt (net of cash). The adoption of accounting rule changes in 2015 affected the calculation of net-debt-to-total capital ratio. (7) Gross profit, calculated as net sales less cost of sales, and gross profit margin, calculated as gross profit divided by net sales, are non-GAAP financial measures as they exclude depreciation and amortization expense associated with the corresponding sales. The majority of our orders are basic distribution with no processing services performed. For the remainder of our sales orders, we perform “first-stage” processing which is generally not labor intensive as we are simply cutting the metal to size. Because of this, the amount of related labor and overhead, including depreciation and amortization, is not significant and is excluded from our cost of sales. Therefore, our cost of sales is substantially comprised of the cost of the material we sell. We use gross profit margin as shown as a measure of operating performance. Gross profit margin is an important operating and financial measure, as fluctuations in our gross profit margin can have a significant impact on our earnings. Gross profit margin, as presented, is not necessarily comparable with similarly titled measures for other companies. 599.9 71.8 1,004.0 2,106.2 $5.36 $0.32 $28.12 23.4% 2.9 32.2% 25.3% 10.0% 9.0% 5.6% 550.7 22.3 1,078.3 1,746.4 $4.82 $0.22 $23.07 27.3% 3.0 37.4% 26.3% 10.9% 10.0% 6.2% 21 1,192.3 1,025.3 4,659.1 508.6 86.2 848.0 973.3 981.3 4,293.5 417.6 86.4 839.3 2,823.7 2,606.4 $2.61 $0.40 $37.83 7.5% 3.3 23.3% 25.1% 5.7% 4.7% 3.1% $2.01 $0.40 $35.34 6.1% 3.3 25.3% 26.3% 4.7% 3.7% 2.8% 1,652.2 998.7 5,184.8 650.2 93.9 1,664.9 2,431.4 $6.56 $0.40 $33.17 22.9% 3.5 41.3% 24.8% 9.8% 8.8% 5.5% Reliance Locations R E LI A N C E D I V I S I O N S Bralco Metals Los Angeles, CA Headquarters 714-736-4800 Albuquerque, NM 505-345-0959 Dallas, TX 972-276-2676 Phoenix, AZ 602-252-1918 Seattle, WA 253-395-0614 Wichita, KS 316-838-9351 Aerotech Alloys A Bralco Metals Company Temecula, CA 951-694-1917 Affiliated Metals A Bralco Metals Company Salt Lake City, UT 801-363-1711 Olympic Metals A Bralco Metals Company Denver, CO 303-286-9700 Central Plains Steel Co. Wichita, KS 316-636-4500 MetalCenter Los Angeles, CA 562-944-3322 Reliance Aerospace Solutions Cypress, CA 714-503-3206 Reliance Metalcenter Colorado Springs, CO 719-390-4911 Dallas, TX 817-640-7222 Oakland, CA 510-476-4400 Phoenix, AZ 602-275-4471 Salt Lake City, UT 801-974-5300 San Antonio, TX 210-661-2301 San Diego, CA 619-263-2141 Reliance Steel Company Albuquerque, NM 505-247-1441 Los Angeles, CA 323-583-6111 Tube Service Co. Los Angeles, CA Headquarters 562-695-0467 Denver, CO 303-321-9200 Phoenix, AZ 602-267-9865 Portland, OR 503-944-5420 San Diego, CA 619-579-3011 San Jose, CA 408-946-5500 S U B S I D I A R I E S All Metal Services Limited A Subsidiary of Reliance Metals UK Holding Limited—Holding Company London, United Kingdom Headquarters 44 189 544 4066 Bangalore, India 91 802 837 9124 Belfast, United Kingdom 44 289 073 9648 Birmingham, United Kingdom 44 167 543 0307 Bolton, United Kingdom 44 194 284 0777 Bristol, United Kingdom 44 117 982 2484 Losse, France 33 558 936 800 All Metal Services Ltd. (Xi’an) A Subsidiary of All Metal Services Limited Xi’an, People’s Republic of China 86 29 86125300 All Metal Services (Malaysia) Sdn. Bhd. A Subsidiary of All Metal Services Limited Selangor Darul Ehsan, Malaysia 60 378 035 643 Allegheny Steel Distributors, Inc. Pittsburgh, PA 412-767-5000 American Metals Corporation Portland, OR Corporate Office 503-651-6700 Fresno, CA 559-266-0881 Sacramento, CA 916-371-7700 American Steel A Division of American Metals Corporation Portland, OR 503-651-6700 22 23 Reliance Locations Seattle, WA 253-437-4080 Haskins Steel Co., Inc. A Division of American Metals Corporation Spokane, WA 509-535-0657 Lampros Steel A Division of American Metals Corporation Portland, OR 503-285-6667 Alaska Steel A Subsidiary of American Metals Corporation Anchorage, AK 907-561-1188 Fairbanks, AK 907-456-2719 Kenai, AK 907-283-3880 AMI Metals, Inc. Nashville, TN Corporate Office 615-377-0400 Fort Worth, TX 817-831-9586 Los Angeles, CA 909-429-1336 Seattle, WA Sales Office 253-735-0181 Spokane, WA 509-570-5880 St. Louis, MO 636-946-9492 Swedesboro, NJ 856-241-9180 Wichita, KS 316-945-7771 AMI Metals Aero Services Ankara Havacılık Anonim Şirketi A Subsidiary of AMI Metals, Inc. Ankara, Turkey 90 312 810 0000 AMI Metals Europe SPRL A Subsidiary of AMI Metals, Inc. Gosselies, Belgium 32 71 37 67 99 AMI Metals France A Subsidiary of AMI Metals, Inc. Figeac, France 33 565 503 460 AMI Metals UK Limited A Subsidiary of Reliance Metals UK Holding Limited—Holding Company Milton Keynes, United Kingdom 44 845 853 6149 Ellesmere Port, United Kingdom 44 151 355 6035 Best Manufacturing, Inc. Jonesboro, AR 870-931-9533 Bralco Metals (Australia) Pty Ltd Melbourne, Australia 61 3 9310 5566 CCC Steel, Inc. Los Angeles, CA 310-637-0111 IMS Steel Co. A Division of CCC Steel, Inc. Salt Lake City, UT 801-973-1000 Chapel Steel Corp. Philadelphia, PA Corporate Office 215-793-0899 Birmingham, AL 205-781-0317 Chicago, IL 815-937-1970 Chicago, IL Sales Office 708-429-2244 Cleveland, OH 216-446-6840 Hamilton, Ontario, Canada 289-780-0570 Houston, TX 713-462-4449 Philadelphia, PA 610-705-0477 Portland, OR 503-228-3355 Chapel Steel Canada, Ltd. A Subsidiary of Reliance Metals Canada Holding Limited—Holding Company Hamilton, Ontario, Canada 289-780-0570 23 Chatham Steel Corporation Savannah, GA Headquarters 912-233-4182 Birmingham, AL 205-791-2261 Columbia, SC 803-799-8888 Durham, NC 919-682-3388 Orlando, FL 407-859-0310 Clayton Metals, Inc. Chicago, IL Headquarters 630-860-7000 Los Angeles, CA 562-921-7070 Newark, NJ 973-588-1100 Continental Alloys & Services Inc. Houston, TX Headquarters 281-376-9600 Lafayette, LA 337-837-9311 Continental Alloys & Services, Inc. A Subsidiary of Reliance Metals Canada Holding Limited—Holding Company Calgary, Alberta, Canada 403-216-5150 Continental Alloys & Services (Malaysia) Sdn. Bhd. A Subsidiary of Continental Alloys & Services, Pte. Ltd. Senai, Johor, Malaysia 6 07 599 9975 Continental Alloys & Services Ltd. A Subsidiary of Reliance Metals UK Holding Limited—Holding Company Brechin, Scotland 44 1356 625 515 Peterhead, Scotland 44 1779 480 420 Continental Alloys & Services Pte. Ltd. A Subsidiary of Reliance Asia Holding Pte. Ltd.—Holding Company Jurong, Singapore 65 6690 0178 Continental Alloys Middle East FZE A Subsidiary of Reliance Steel & Aluminum Co. Dubai, United Arab Emirates 971 4 8809770 Crest Steel Corporation Riverside, CA 951-727-2600 Delta Steel, Inc. Houston, TX Headquarters 713-635-1200 Cedar Hill, TX 817-701-5213 Chicago, IL 708-757-7198 Fort Worth, TX 817-293-5015 San Antonio, TX 210-661-4641 Smith Pipe & Steel Co. A Subsidiary of Delta Steel, Inc. Phoenix, AZ 602-257-9494 Diamond Manufacturing Company Wyoming, PA Headquarters 800-233-9601 Cedar Hill, TX 972-291-8800 Michigan City, IN 219-874-2374 Perforated Metals Plus A Division of Diamond Manufacturing Company Charlotte, NC 704-598-0443 McKey Perforating A Division of Diamond Manufacturing Company New Berlin, WI 800-345-7373 Manchester, TN 931-723-3636 Durrett Sheppard Steel Co., Inc. Baltimore, MD 410-633-6800 Earle M. Jorgensen Company Los Angeles, CA Headquarters 323-567-1122 Atlanta, GA 678-894-7241 Birmingham, AL 205-814-0043 Boston, MA 508-435-6854 Charlotte, NC 704-588-3001 Chicago, IL 847-301-6100 Cincinnati, OH 513-771-3223 Cleveland, OH 330-425-1500 Cleveland, OH (Plate) 330-963-8150 Dallas, TX 214-741-1761 Denver, CO 303-287-0381 Detroit, MI 734-402-8110 Hartford, CT 860-435-6854 Houston, TX 713-672-1621 Indianapolis, IN 317-838-8899 Kansas City, MO 816-483-4140 Lafayette, LA 713-672-1621 Memphis, TN 901-317-4300 Minneapolis, MN 763-784-5000 Oakland, CA 510-487-2700 Orlando, FL 704-421-7227 Philadelphia, PA 215-949-2850 Phoenix, AZ 602-272-0461 Portland, OR 503-283-2251 Quad Cities, IA 563-285-5340 Richmond, VA 804-732-7491 Rochester, NY 585-425-1500 Salt Lake City, UT 801-532-2543 St. Louis, MO 314-291-6080 Tulsa, OK 618-835-1511 Encore Metals USA A Division of Earle M. Jorgensen Company Portland, OR 503-620-8810 Salt Lake City, UT 801-383-3808 24 25 Steel Bar A Division of Earle M. Jorgensen Company Charlotte, NC 336-294-0053 Reliance Metals Canada Limited A Subsidiary of Earle M. Jorgensen Company Edmonton, Alberta, Canada Corporate Office 780-801-4114 Earle M. Jorgensen (Canada) A Division of Reliance Metals Canada Limited Edmonton, Alberta, Canada Headquarters 780-801-4015 Montreal, Quebec, Canada 450-661-5181 North Bay, Ontario, Canada 705-474-0866 Quebec City, Quebec, Canada 418-870-1422 Toronto, Ontario, Canada 905-564-0866 Encore Metals A Division of Reliance Metals Canada Limited Vancouver, British Columbia, Canada Headquarters 604-940-0439 Calgary, Alberta, Canada 403-236-1418 Edmonton, Alberta, Canada 780-436-6660 Prince George, British Columbia, Canada 250-563-3343 Winnipeg, Manitoba, Canada 204-663-1450 Portage, IN 219-787-9698 GH Metal Solutions, Inc. A Subsidiary of Feralloy Corporation Fort Payne, AL 256-845-5411 Acero Prime S. de R.L.de C.V A Joint Venture of Feralloy Corporation 60% Owned San Luis Potosi, Mexico Headquarters 52 444 870 7700 Monterrey, Mexico 52 818 000 5300 Ramos Arizpe, Mexico 52 844 450 6400 Toluca, Mexico 52 722 262 5500 Feralloy Processing Company A Joint Venture of Feralloy Corporation 51% Owned Portage, IN 219-787-8773 Indiana Pickling & Processing Company A Joint Venture of Feralloy Corporation 56% Owned Portage, IN 219-787-8889 Oregon Feralloy Partners A Joint Venture of Feralloy Corporation 40% Owned Portland, OR 503-286-8869 Fox Metals and Alloys, Inc. Houston, TX 281-890-6666 Team Tube A Division of Reliance Metals Canada Limited Vancouver, British Columbia, Canada Headquarters 604-468-4747 Calgary, Alberta, Canada 403-279-8131 Edmonton, Alberta, Canada 780-462-7222 Montreal, Quebec, Canada 450-978-8877 Toronto, Ontario, Canada 905-878-1156 Earle M. Jorgensen (Asia) Sdn. Bhd. A Subsidiary of Reliance Asia Holding Pte. Ltd.—Holding Company Nusajaya, Malaysia 60 7 531 9155 Everest Metals (Suzhou) Co., Ltd. A Subsidiary of Reliance Asia Holding Pte. Ltd.—Holding Company Suzhou, People’s Republic of China 86 512 6760 7075 Feralloy Corporation Chicago, IL Corporate Office 773-380-1500 Charleston, SC 843-336-4107 Decatur, AL 256-301-0500 25 Infra-Metals Co. Philadelphia, PA Corporate Office 215-741-1000 Baltimore, MD 410-355-1664 Hallandale, FL Sales Office 954-454-1564 Marseilles, IL 815-795-5002 New Boston, OH 740-353-1350 Petersburg, VA 804-957-5900 Tampa, FL 813-626-6005 Wallingford, CT 203-294-2980 Athens Steel A Division of Infra-Metals Co. Atlanta, GA 706-552-3850 IMS Steel A Division of Infra-Metals Co. Atlanta, GA 404-577-5005 Liebovich Bros., Inc. Rockford, IL Corporate Office 815-987-3200 Custom Fab Company A Division of Liebovich Bros., Inc. Rockford, IL 815-987-3210 Good Metals Company A Division of Liebovich Bros., Inc. Grand Rapids, MI 616-241-4425 Hagerty Steel & Aluminum Company A Division of Liebovich Bros., Inc. Peoria, IL 309-699-7251 Bridgeton, MO 309-699-7251 Liebovich Steel & Aluminum Company A Division of Liebovich Bros., Inc. Rockford, IL Headquarters 815-987-3200 Madison, IL 618-452-6000 Randleman, NC 336-498-8900 Springfield, OH 937-882-6354 Wooster, OH 330-264-8416 Metals USA Plates and Shapes, Northeast, L.P. A Subsidiary of Metals USA, Inc. Ambridge, PA 724-266-7708 Cedar Rapids, IA 319-366-8431 Green Bay, WI 920-759-3500 Rockford, IL 815-964-9471 Rockford, IL 815-874-8536 Metals USA, Inc. Ft. Lauderdale, FL Corporate Office 954-202-4000 Gregor Technologies, LLC A Subsidiary of Metals USA, Inc. Torrington, CT 860-482-2569 Metals USA Carbon Flat Rolled, Inc. A Subsidiary of Metals USA, Inc. Jeffersonville, IN 812-288-8906 Fairless Hills, PA 215-337-7000 Langhorne, PA 267-580-2100 Newark, NJ 973-242-1000 Philadelphia, PA 215-673-9300 Seekonk, MA 508-399-8500 York, PA 717-757-3549 Metals USA Plates and Shapes Southcentral, Inc. A Subsidiary of Metals USA, Inc. Cedar Hill, TX 972-299-6497 Enid, OK 580-233-0411 Muskogee, OK 918-487-6800 Tulsa, OK 918-583-2222 Metals USA Plates and Shapes Southeast, Inc. A Subsidiary of Metals USA, Inc. Greensboro, NC 336-674-7991 Ohio River Metal Services, Inc. A Subsidiary of Metals USA, Inc. Jeffersonville, IN 812-282-4770 The Richardson Trident Company, LLC A Subsidiary of Metals USA, Inc. Odessa, TX 432-561-5446 Jacksonville, FL 904-766-0003 Mobile, AL 251-456-4531 Oakwood, GA 770-536-1214 Waggaman, LA 504-431-7010 Metals USA Specialty Metals Northcentral, Inc. A Subsidiary of Metals USA, Inc. Germantown, WI 262-255-4444 Horicon, WI 920-485-9750 Liberty, MO 816-415-0004 Northbrook, IL 847-291-2400 Walker, MI 616-453-9845 Lynch Metals A Division of Metals USA Specialty Metals Northcentral, Inc. Union, NJ Headquarters 908-686-8401 Anaheim, CA 714-238-7240 26 Richardson, TX 972-231-5176 Tulsa, OK 918-252-5781 Metalweb Limited Birmingham, United Kingdom Headquarters 44 121 328 7700 Kilkeel, United Kingdom 44 284 176 3050 London, United Kingdom 44 199 245 0300 Manchester, United Kingdom 44 161 483 9662 Oxford, Kingdom 44 186 588 4499 National Specialty Alloys, Inc. Houston, TX Headquarters 281-345-2115 Anaheim, CA 714-870-7800 Buford, GA 770-945-9255 27 Aleaciones Especiales de Mexico S de R.L. de C.V. A Subsidiary of National Specialty Alloys, Inc. Cuautitlan, Mexico 52 55 2225 0835 Northern Illinois Steel Supply Co. Channahon, IL 815-467-9000 Pacific Metal Company Portland, OR Headquarters 503-454-1051 Billings, MT 406-245-2210 Boise, ID 208-323-8045 Eugene, OR 541-485-1876 Seattle, WA 253-796-2840 Spokane, WA 509-535-0326 PDM Steel Service Centers, Inc. Elk Grove, CA Corporate Office 916-513-4548 Boise, ID 208-343-6298 Denver, CO 303-297-1456 Fresno, CA 559-442-1410 Grand Junction, CO Sales Office 970-858-3441 Las Vegas, NV 702-413-0067 Provo, UT 801-798-8676 Reno, NV 775-358-1441 Santa Clara, CA 408-988-3000 Stockton, CA 209-943-0513 Vancouver, WA 360-225-1133 PDM (Feralloy) A Division of PDM Steel Service Centers, Inc. Stockton, CA 209-234-0548 Phoenix Corporation Doing Business as Phoenix Metals Company Atlanta, GA Headquarters 770-447-4211 Baton Rouge, LA 225-272-3228 Birmingham, AL 205-841-7477 Charlotte, NC 704-588-7075 Cincinnati, OH 513-727-4763 Dayton, OH 937-667-6255 Indianapolis, IN 765-778-4452 Kenton, OH 419-674-4186 Middletown, OH 513-423-4166 Portage, IN 219-850-5080 Talladega, AL 256-315-2345 Toledo, OH 419-661-1100 Vonore, TN 423-271-3690 Woodhaven, MI 734-301-4001 Reliance Metalcenter Asia Pacific Pte. Ltd. A Subsidiary of Reliance Asia Holding Pte. Ltd.— Holding Company Jurong, Singapore 65 6265 1211 Service Steel Aerospace Corp. Seattle, WA Headquarters 253-627-2910 Canton, OH 330-833-5800 Wichita, KS 316-838-7737 Gary, IN 219-886-2777 Kansas City, KS 913-321-5200 Nashville, TN 931-486-1456 Philadelphia, PA 215-295-9512 Richmond, VA 804-222-5052 Russellville, AR 479-452-3802 St. Louis, MO 636-379-4050 Tampa, FL 813-626-8999 Aluminum & Stainless, Inc. A Division of Phoenix Coporation Lafayette, LA Headquarters 337-837-4381 New Orleans, LA 504-586-9191 Precision Flamecutting and Steel, Inc. Houston, TX 281-477-1600 Precision Strip, Inc. Minster, OH Headquarters 419-628-2343 Bowling Green, KY 270-542-6100 27 Dynamic Metals International A Division of Service Steel Aerospace Corp. Bristol, CT 860-688-8393 United Alloys Aircraft Metals A Division of Service Steel Aerospace Corp. Los Angeles, CA 323-588-2688 Siskin Steel & Supply Company, Inc. Chattanooga, TN Headquarters 423-756-3671 Louisville, KY 502-716-5140 Nashville, TN 615-242-4444 Spartanburg, SC 864-599-9988 East Tennessee Steel Supply A Division of Siskin Steel & Supply Company, Inc. Morristown, TN 423-587-3500 Sugar Steel Corporation Chicago, IL Headquarters 708-757-9500 Evansville, IN 812-428-5490 Sunbelt Steel Texas, Inc. Houston, TX Headquarters 713-937-4300 Lafayette, LA 337-330-4140 Toma Metals, Inc. Johnstown, PA 814-536-3596 Tubular Steel, Inc. St. Louis, MO Headquarters 314-851-9200 Katy, TX 281-371-5200 Hazelwood, MO 314-524-6600 Rialto, CA 909-429-6900 Savannah, GA 912-748-2405 Staunton, IL 618-635-3695 Westmont, IL Sales Office 630-515-5500 Metalcraft Enterprises, Inc. A Subsidiary of Tubular Steel, Inc. New Haven, MO 800-325-0890 Valex Corp. Ventura, CA 805-658-0944 Valex China Co., Ltd. A Subsidiary of Valex Holdings Limited— Holding Company Shanghai, People’s Republic of China 86 21 5818 3189 Valex Korea Co., Ltd. A 95% Owned Subsidiary of Valex Corp. Seoul, Republic of Korea 82 31 683 0119 Viking Materials, Inc. Minneapolis, MN Headquarters 612-617-5800 Chicago, IL 847-451-7171 Yarde Metals, Inc. Hartford, CT Headquarters 860-406-6061 Cleveland, OH 330-342-7020 Greensboro, NC 336-500-0535 Long Island, NY 631-232-1600 Morristown, NJ 973-463-1166 Nashua, NH 603-635-1266 Philadelphia, PA 610-495-7545 28 Corporate Directory D I R E C TO R S Mark V. Kaminski (1), (2), (3), (4), (5) Executive Chairman of the Board and Director Graniterock Robert A. McEvoy (1), (3), (4) Investment Advisor Brasil Warrant LLC and Former Managing Director Goldman Sachs Sarah J. Anderson (1), (2), (4) Former Partner Ernst & Young LLP Karen W. Colonias (1), (2), (3) President and Chief Executive Officer Simpson Manufacturing Co., Inc. John G. Figueroa (1), (3), (4) Chief Executive Officer Genoa Healthcare Thomas W. Gimbel (1), (4) Former Trustee The Florence Neilan Trust David H. Hannah Former Chief Executive Officer and Executive Chairman of the Board Reliance Steel & Aluminum Co. Douglas M. Hayes (1), (2), (3), (4) President Hayes Capital Corporation Gregg J. Mollins President and Chief Executive Officer Reliance Steel & Aluminum Co. Andrew G. Sharkey (1), (2), (3), (4) Former President and Chief Executive Officer American Iron and Steel Institute Douglas W. Stotlar (1), (2), (3) Director Detroit Branch of the Federal Reserve Bank of Chicago and Former President and Chief Executive Officer Con-way Inc. O F F I C E R S Gregg J. Mollins President and Chief Executive Officer Karla R. Lewis Senior Executive Vice President and Chief Financial Officer James D. Hoffman Executive Vice President and Chief Operating Officer William K. Sales, Jr. Executive Vice President, Operations Stephen P. Koch Senior Vice President, Operations Michael P. Shanley Senior Vice President, Operations William A. Smith II Senior Vice President, General Counsel and Corporate Secretary Arthur Ajemyan Vice President and Corporate Controller Susan Borchers Chief Information Officer Brenda S. Miyamoto Vice President, Corporate Initiatives Donna M. Newton Vice President, Benefits Donald J. Prebola Vice President, Health, Safety & Human Resources John A. Shatkus Vice President, Internal Audit Silva Yeghyayan Vice President, Tax (1) Independent Director | (2) Member of the Audit Committee | (3) Member of the Compensation Committee | (4) Member of the Nominating and Governance Committee | (5) Independent Chairman of the Board 30 Corporate Information TRANSFER AGENT & REGISTRAR FORM 10-K MARKET PRICE OF COMMON STOCK American Stock Transfer & A copy of the Annual Report on Form The high and low closing sales prices for Trust Company 6201 15th Avenue Brooklyn, NY 11219 800-937-5449 718-921-8124 www.amstock.com 10-K, filed with the Securities and Exchange the Company’s common stock in 2016 were Commission, is available at www.sec.gov or $87.58 and $50.08. The following table sets investor.rsac.com or upon request to: forth the high and low intraday reported sale Karla R. Lewis Senior Executive Vice President and prices of the Company’s common stock for the stated calendar quarters: Chief Financial Officer 2016 HIGH LOW INDEPENDENT AUDITORS Reliance Steel & Aluminum Co. KPMG LLP Los Angeles, CA RELIANCE STEEL & ALUMINUM CO. 350 South Grand Avenue Suite 5100 Los Angeles, CA 90071 1Q 2Q 3Q 4Q $71.34 $50.08 $78.38 $67.57 $84.25 $67.66 $87.58 $65.10 CORPORATE HEADQUARTERS INVESTOR RELATIONS CONTACT STOCKHOLDERS OF RECORD 350 South Grand Avenue Suite 5100 Los Angeles, CA 90071 213-687-7700 www.rsac.com ANNUAL MEETING 10:00 a.m. Wednesday, May 17, 2017 The Omni Hotel 251 South Olive Street Los Angeles, CA 90071 All stockholders are invited to attend. E E L G N U O Y : Y H P A R G O T O H P N A Y O T S : N G I S E D Brenda S. Miyamoto 213-576-2428 investor@rsac.com SECURITIES LISTING AND DIVIDEND POLICY As of January 31, 2017, there were approximately 205 record holders of our common stock. We have paid quarterly cash dividends on our common stock for 57 years. Reliance Steel & Aluminum Co.’s common In February 2017, our Board of Directors stock is traded on the New York Stock increased the regular quarterly cash dividend Exchange under the symbol “RS.” amount 5.9% to $0.45 per share. Our Board of Directors has increased the quarterly dividend rate on a periodic basis with the most recent being our 24th increase since our IPO in 1994. 350 SOUTH GRAND AVENUE, SUITE 5100 | LOS ANGELES, CA 90071 | 213-687-7700 | WWW.RSAC.COM
Continue reading text version or see original annual report in PDF format above