Reliance Steel & Aluminum
Annual Report 2019

Plain-text annual report

RELIANCE STEEL & ALUMINUM CO. POWERED BY RESILIENCE: CELEBRATING 80 YEARS AND BEYOND 2019 ANNUAL REPORT Powered by a resilient business model and an unwavering commitment to service and innovation, 80 years after our humble beginnings, Reliance has cemented our position at the top of the metals service center industry. Fueled by our successes, we forge into the future to evolve into an even more diversified metal solutions provider and to build a stronger, more sustainable, and lasting legacy for our customers, employees, stockholders, and ourselves. FORTUNE 500 R ANKING 275 OUR HIGHEST EVER BY INNOVATION 2 2019 ANNUAL REPORTWe are on the cutting edge – literally. Over the past five years Reliance has vastly outspent our competitors, investing close to $1 billion into self-improvement – with nearly half of that going directly to growth initiatives. We keep our equipment and employees the sharpest in the industry so we can provide not only best-in-class service but expanded value-added processing services and solutions to meet our customers’ business needs. RECORD $242 MILLION IN CAPITAL EXPENDITURES IN 2019 3 POWERED BY RESILIENCEOur approximately 15,000 employees include machine operators, drivers, inside and outside sales teams, engineers, metallurgists, specialists across a variety of professional disciplines including IT, finance, management, and more. Our executive management team has over a century of combined relevant metals industry experience. Every day, the collective effort of this diverse and dedicated team keeps Reliance in top form and at the top of our industry. Our people are truly the source of our success! WINNER: FASTMARKETS AMM 2019 SERVICE CENTER OF THE YE AR BY OUR PEOPLE BY SAFETY 6 2019 ANNUAL REPORTIn 2019, our SMART Safety program unified our safety efforts under the theme, “One Family, One Culture.” The results? A 10% reduction in OSHA recordables compared to 2018. In 2020, we “Make it Personal.” We believe that an individual, personalized safety-first approach empowers a ripple effect that has a positive impact on teams, locations, and our entire Family of Companies. JIM HOFFMAN NAMED 2020 CEO “ WHO GE TS IT ” BY SAFE T Y + HE ALTH MAGA ZINE 7 POWERED BY RESILIENCEWe are devoted to our customers and our communities. In keeping with our decentralized business model, we encourage each member of our Family of Companies to serve and contribute to the causes that are important to their employees and their local community. At the same time, we come together to serve in national causes like the 9/11 Day of Service and give to one another through our employee emergency assistance fund, Reliance Cares. BY SERVICE SELECTED CONSOLIDATED FINANCIAL DATA In millions, except number of shares which are reflected in thousands and per share amounts. Year Ended December 31, Income Statement Data: Net sales Cost of sales (exclusive of depreciation and amortization expense) Gross profit(1) Warehouse, delivery, selling, general and administrative expense(2) Depreciation and amortization expense Impairment of long-lived assets Operating income Other (income) expense: Interest expense Other (income) expense, net(2) Income before income taxes Provision (benefit) for income taxes(3) Net income(3) Less: Net income attributable to noncontrolling interests 2019 2018 2017 2016 2015 $10,973.8 $11,534.5 $9,721.0 $8,613.4 $9,350.5 7,644.4 8,253.0 6,933.2 6,023.1 6,803.6 3,329.4 2,095.4 3,281.5 2,091.8 2,787.8 1,902.8 2,590.3 1,798.1 2,546.9 1,725.3 219.3 1.2 1,013.5 85.0 (0.8) 929.3 223.2 706.1 4.6 215.2 37.0 937.5 86.2 0.7 850.6 208.8 641.8 8.1 218.4 4.2 662.4 73.9 4.7 583.8 (37.2) 621.0 7.6 222.0 52.4 517.8 84.6 4.0 429.2 120.1 309.1 4.8 218.5 53.3 549.8 84.3 6.8 458.7 142.5 316.2 4.7 Net income attributable to Reliance(3) $701.5 $633.7 $613.4 $304.3 $311.5 Earnings Per Share: Diluted(3) Basic(3) Weighted average shares outstanding – diluted Weighted average shares outstanding – basic Other Data: $10.34 $10.49 67,855 66,885 $8.75 $8.85 72,441 71,621 $8.34 $8.42 73,539 72,851 $4.16 $4.21 73,121 72,363 $4.16 $4.20 74,902 74,096 Cash flow provided by operations $1,301.5 $664.6 $399.0 $626.5 $1,025.0 Capital expenditures Cash dividends per share Balance Sheet Data (December 31): Working capital Total assets Short-term debt(4) Long-term debt(4) Total equity 242.2 2.20 239.9 2.00 161.6 1.80 154.9 1.65 172.2 1.60 $2,334.9 $2,585.9 $2,347.6 $2,032.5 $1,564.5 8,131.1 8,044.9 7,751.0 7,411.3 7,121.6 65.6 1,525.2 5,214.1 66.8 2,141.1 4,679.5 92.6 1,809.6 4,699.9 83.1 1,847.2 4,179.1 501.3 1,428.9 3,942.7 (1) Gross profit, calculated as net sales less cost of sales, is a non-GA AP financial measure as it excludes depreciation and amortization expense associated with the corresponding sales. About half 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 expense, is not significant and is excluded from 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) The adoption of accounting rule changes in 2017 affected the presentation of pension costs. Prior year warehouse, delivery, selling, general and administrative expense and other (income) expense, net have been retrospectively adjusted to conform to the current presentation. (3) 2017 includes a $207.3 million, or $2.82 per share, income tax benefit as a result of the Tax Cuts and Jobs Act of 2017. (4) Includes finance lease obligations. 10 10 2 019 A N N U A L R E P O R T 2019 ANNUAL REPORT STOCKHOLDERS In 2019, we celebrated two important milestones: our and pricing pressure in the markets we serve, which 80th company anniversary and the 25th anniversary of resulted in a 4.9% year-over-year decline in annual net our initial public offering. Since Reliance’s founding sales. Despite these challenging market conditions, as a local steel distributor in Los Angeles, California we achieved another year of record financial results: in 1939 and through decades of growth and expansion our 2019 gross profit margin of 30.3% was the highest into a leading diversified metal solutions provider in Reliance’s history and produced record annual today with over 300 locations in 40 states and 13 gross profit dollars of $3.3 billion, record pretax countries outside the United States, the primary focus income of $929.3 million, record net income of $701.5 of our business and the core of our success has been million, and record earnings per diluted share of outstanding customer service delivered with integrity. $10.34. Further, our strong profitability and focus on Expansion initiatives – accretive acquisitions, solid working capital management generated record cash organic growth, and innovative investments in value- flow from operations of $1.3 billion. We attribute added processing – have always been undertaken with these achievements to our proven business model and the purpose of serving our customers and providing increased resilience to fluctuations in metals pricing value to our stockholders. We believe our history is resulting from the diversity of our products, end the key to writing the story of our future. Building on markets, and geographies, as well as our increased the momentum of our accomplishments thus far, we focus on value-added processing. enter another decade with renewed enthusiasm to exceed the expectations of our customers, employees, Reliance continues to benefit from our long-term vendors, and stockholders while making meaningful strategy of serving a broad spectrum of end markets social contributions that reflect our commitments to – including aerospace, automotive, non-residential these stakeholder groups as well as the communities, construction, heavy industry, and energy – which environment, and world we share with those around us. helps mitigate volatility in any single sector. Further, our decentralized operating structure allows us to We began 2019 with a company-wide goal to drive concentrate on small orders; the majority of our continuous improvements in our business following customers purchase in smaller quantities on a when- a record year of significant financial and operational needed basis and are generally less price sensitive milestones. We challenged ourselves to sustain our than customers that place large volume orders with operating momentum, and we are extremely pleased long lead times. In 2019, our average order size was with the outcome. Our managers in the field continued $2,090 and approximately 40% of our orders were their excellent performance amidst overall demand delivered within 24 hours. 11 POWERED BY RESILIENCEUnlike 2018, where earnings were supported by We are extremely proud of our record cash flow favorable pricing conditions stemming from solid generation in 2019. We are equally pleased with our demand trends and trade actions, the overall pricing strategic allocation of capital, which is a balanced environment in 2019 remained under pressure, resulting approach focused on both growth and stockholder in a 1.3% decline in our average selling price year- returns. Our twofold growth strategy of leveraging over-year. Customer demand also softened, with our capital expenditures to drive organic expansion, same-store tons sold declining 4.2% compared to 2018. coupled with strategic acquisitions of well-managed Nevertheless, we were able to maintain an industry- metals service centers, continues to solidify our leading gross profit margin due to strong execution by position as a leading diversified metal solutions our managers in the field and their expertise in operating provider in North America. profitably throughout industrial cycles. Our managers maintained a disciplined approach to pricing and Over the last five years, Reliance has invested almost focused on high quality, high margin business. At the $1 billion in capital expenditures, with approximately same time, they identified new opportunities to expand 50% dedicated to growth initiatives. In 2019, we our value-added processing capabilities in order to meet invested a record $242.2 million in new, innovative – and in many cases, exceed – our customers’ needs equipment and advanced technology to improve while simultaneously increasing our margins. In 2019, the safety of our operations, enhance working we performed value-added processing services on 51% environments for our employees, and fund growth and of our orders, an uptick from 49% in 2018 and our more innovation initiatives to better meet our customers’ historical rate of approximately 40%. As a result of our needs. Our 2020 capital expenditure budget maintains strategic investments in value-added processing, along our focus on strengthening our value-added with our ability to maintain a FIFO gross profit margin of processing capabilities, as well as facility upgrades 28.8% or higher in each quarter of 2019, we increased and expansions. our estimated sustainable gross profit margin range to 28% to 30% in early 2020 from our prior range of Reliance has always focused on innovation in all 27% to 29%. On approximately $11 billion of sales, this aspects of our business. In February 2020, we launched represents a significant increase in gross profit dollars. FastMetals, Inc., our new e-commerce business. NET SALES (IN MILLIONS) CASH FLOW FROM OPERATIONS (IN MILLIONS) $10,973.8 2019 $1,301.5 $11,534.5 2018 $664.6 $9,721.0 $ 8,613.4 $9,350.5 2017 2016 2015 $ 399.0 $626.5 $1,025.0 2019 2018 2017 2016 2015 12 2019 ANNUAL REPORTCentrally located in Massillon, Ohio and with direct $0.625 per share in the first quarter of 2020. We also access to Reliance’s vast network of metals service repurchased $50 million of our stock in 2019. These centers, FastMetals was created to address the actions underscore our commitment to delivering value growing demand for online purchasing solutions and to our stockholders as well as ongoing confidence in to provide an additional channel to experience our our business model. unique, customer-focused business and access our wide range of products. In our day-to-day business operations, the health and safety of our approximately 15,000 employees Reliance completed one acquisition in 2019, bringing worldwide remains our highest priority. We began to our total post-IPO acquisition count to 67. On December ramp up our efforts to reinvigorate our safety culture 31, 2019, we acquired Fry Steel Company, a general line in 2017 with our SMART Safety program, a peer-to- and long bar distributor located in Santa Fe Springs, peer program that builds a safety culture based on California that specializes in the cutting of various bar employees watching out for each other to promote products including stainless, alloy, aluminum, carbon, a safe, accident-free work environment. Our 2019 brass and bronze. We remain true to our strategic campaign focused on cultivating a common culture objective of acquiring high quality businesses with of safety across our entire Family of Companies and strong management teams and superior levels of introduced a mentoring element to foster learning at customer service that complement our product and end the location level. Our 2020 SMART Safety theme “Make market diversification strategy as the opportunities it Personal” promotes individual safety commitment, present themselves. engagement, preparedness, and accountability. Returning value to our stockholders through quarterly Beyond our commitment to safety, Reliance provides cash dividends and share repurchases remains core to a suite of benefits to help our employees enjoy our capital allocation philosophy. We have paid regular healthy, meaningful lives. In an environment where quarterly cash dividends for 60 consecutive years and healthcare costs continue to rise, we are proud to offer have increased our dividend 27 times since our 1994 our employees and their dependents comprehensive IPO, including our most recent increase of 13.6% to healthcare options that reduce financial burden NET INCOME (IN MILLIONS) E ARNINGS PER SHARE (DILUTED) 2019 2018 2017 2016 2015 $701.5 2019 $10.34 $633.7 $613.4* $ 304.3 $ 311.5 2018 2017 2016 2015 $ 8.75 $ 8.34* $ 4.16 $ 4.16 * Includes a $207.3 million, or $2.82 per share, income tax benefit as a result of the Tax Cuts and Jobs Act of 2017. 13 POWERED BY RESILIENCEand promote their personal well-being, including of our proprietary delivery fleet is composed of a wellness program that includes onsite health energy-efficient diesel tractors that consume less screenings and personalized coaching to drive fuel and reduce emissions. As we make further behavioral and lifestyle improvements. innovative investments to support our customers and our business, we will also continue to evaluate and Our dedication to each and every member of our implement initiatives that support our environment. Family of Companies was the foundation for “Reliance Cares,” our emergency assistance fund dedicated to Reliance is extremely proud of our 80-year history supporting employees impacted by natural disasters. which includes 25 years as a publicly traded company; Through employee funded contributions, matched industrywide recognition as the Acquirer of Choice dollar for dollar by Reliance, we have been able and Top Service Center; and being named among the to provide over 200 grants to employees since the “World’s Most Admired” and Fortune 500 companies. inception of Reliance Cares in 2017. We started as a small, family-run business. As we grew, other family-run businesses wanted to be acquired by Reliance is also devoted to investing in and enriching Reliance because our decentralized model champions the communities in which we live and work. We relationships and maintains their respected identity encourage each member of our Family of Companies and reputation. Today we are recognized as the largest to participate in community events and often match metals service center company in North America and a their local fundraising efforts. In 2019, Reliance was leading metal solutions provider. More than anything, a corporate sponsor of the “Meal Pack for 9/11 Day” though, we are a Family of Companies that continues in observance of the 9/11 National Day of Service and to grow and evolve. Our 2019 results demonstrate our Remembrance, which honors victims, first responders, resilience to ever-changing market conditions and our military personnel and others impacted by the 9/11 ability to produce record results through the excellent terrorist attacks. We also actively support our veterans operational execution of our employees. Despite and enlisted members of the Armed Forces and their global uncertainty attributable to the coronavirus families through numerous non-profit organizations pandemic, we look to the future with optimism and and we work hard to welcome veterans into the Reliance a steadfast commitment to promoting a safe and Family of Companies through recruiting efforts and job healthy operating environment for our employees, placement programs. Looking ahead, we will continue maximizing our earnings, and increasing value for our to seek, support, and participate in national and local stockholders. On behalf of Reliance, we would like to community engagement opportunities, including those in express deep gratitude to our loyal supporters for their which our employees can participate. ongoing partnership. We look forward to continued success in 2020, and for many years beyond. Finally, we are committed to environmental responsibility. Our operations, by nature, involve inherently sustainable products: steel and aluminum, the primary metals we work with, can be fully recycled without loss of quality. We purchase significant volumes of metal produced from electric arc furnaces that repurpose recycled metals into prime material. Additionally, we have installed natural and energy- JAMES D. HOFFMAN President and Chief Executive Officer efficient lighting in many of our facilities and use propane fuel to operate our forklifts. The majority KARLA R. LEWIS Senior Executive Vice President and Chief Financial Officer 14 2019 ANNUAL REPORTBY PRODUCT C A RBON S TEEL PL ATE C A RBON S TEEL TUBING C A RBON S TEEL S TRUCTUR A L S HE AT-TRE ATED A LUMINUM PL ATE HOT-ROL L ED S TEEL SHEE T & COIL S TA INL E S S S TEEL B A R & TUBE 11% 11% 10% 7% 7% 7% C A RBON S TEEL B A R 6% A LUMINUM B A R & TUBE COMMON A L LOY A LUMINUM SHEE T & COIL MISCEL L A NEOUS, INCLUDING BR A S S, COPPER, TITA NIUM, M A NUFACTURED PA RT S A ND SCR A P S TA INL E S S S TEEL SHEE T & COIL A L LOY B A R & ROD GA LVA NIZED S TEEL SHEE T & COIL TOL L PROCE S SING – A LUMINUM, C A RBON S TEEL A ND S TA INL E S S S TEEL* 5% 5% 5% 5% 4% 4% 4% COL D-ROL L ED S TEEL SHEE T & COIL 3% S TA INL E S S S TEEL PL ATE 2% COMMON A L LOY A LUMINUM PL ATE HE AT-TRE ATED A LUMINUM SHEE T & COIL A L LOY TUBE A L LOY PL ATE, SHEE T & COIL 1% 1% 1% 1% 16 *Includes revenues for logistics services provided by our toll processing companies. 2019 ANNUAL REPORTBY COMMODITY CARBON STEEL 52% ALUMINUM 19% STAINLESS STEEL 14% ALLOY 6% MISCELL ANEOUS 5% TOLL PROCESSING AND LOGISTICS 4% 17 POWERED BY RESILIENCEBY REGION MIDWEST 30% WEST/SOUTHWEST SOUTHE A ST 23% 19% INTERNATIONAL 8% MID-ATL ANTIC NORTHE A ST 7% 6% PACIFIC NORTHWEST 4% MOUNTAIN 3% 18 2019 ANNUAL REPORTBY PRESENCE STATES AL ABAMA AL A SK A ARIZONA ARK ANSA S CALIFORNIA COLOR ADO CONNECTICUT FLORIDA GEORGIA IDAHO ILLINOIS INDIANA IOWA K ANSA S KENTUCK Y LOUISIANA MARYL AND OHIO OKL AHOMA OREGON MA SSACHUSET TS PENNSYLVANIA MICHIGAN MINNESOTA MISSOURI MONTANA NEVADA NEW HAMPSHIRE NEW JERSE Y NEW ME XICO NEW YORK NORTH CAROLINA RHODE ISL AND SOUTH CAROLINA TENNESSEE TE X A S UTAH VIRGINIA WA SHINGTON WISCONSIN INTERNATIONAL AUSTRALIA BELGIUM CANADA CHINA FRANCE INDIA MALAYSIA MEXICO SINGAPORE SOUTH KOREA TURKEY UNITED ARAB EMIRATES UNITED KINGDOM 19 POWERED BY RESILIENCEHISTORICAL FINANCIAL DATA In millions, except per share data. Year Ended December 31, Income Statement Data: Net sales Operating income(1) Pretax income Income taxes(2) Net income attributable to Reliance(2) Weighted average shares outstanding – diluted Balance Sheet Data (December 31): Current assets Working capital Net fixed assets Total assets(3) Current liabilities Short-term debt(3) Long-term debt(3) Total equity Per Share Data: Earnings – diluted(2) 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 Net income margin – Reliance(2) 2019 2018 2017 2016 2015 2014 2013 2012 2011 2010 2009 $10,973.8 $11,534.5 $9,721.0 $8,613.4 $9,350.5 $10,451.6 $9,223.8 $8,442.3 $8,134.7 $6,312.8 $5,318.1 1,013.5 929.3 223.2 701.5 67.9 937.5 850.6 208.8 633.7 72.4 662.4 583.8 (37.2) 613.4 73.5 517.8 429.2 120.1 304.3 73.1 $3,010.2 $3,285.0 $3,051.3 $2,688.5 $2,554.2 $3,121.1 $2,738.9 $2,277.4 $2,274.7 $1,700.9 $1,390.9 2,334.9 1,795.2 8,131.1 675.3 65.6 1,525.2 5,214.1 $10.34 $2.20 $77.83 15.1% 4.5 21.4% 30.3% 9.2% 8.5% 6.4% 2,585.9 1,729.9 8,044.9 699.1 66.8 2,141.1 4,679.5 $8.75 $2.00 $69.83 13.9% 4.7 30.8% 28.4% 8.1% 7.4% 5.5% 2,347.6 1,656.3 7,751.0 703.7 92.6 1,809.6 4,699.9 $8.34 $1.80 $64.29 9.8% 4.3 27.2% 28.7% 6.8% 6.0% 6.3% 2,032.5 1,662.2 7,411.3 656.0 83.1 1,847.2 4,179.1 $4.16 $1.65 $57.07 7.8% 4.1 30.3% 30.1% 6.0% 5.0% 3.5% 549.8 458.7 142.5 311.5 74.9 1,564.5 1,635.5 7,121.6 989.7 501.3 1,428.9 3,942.7 $4.16 $1.60 $54.59 8.0% 2.6 31.8% 27.2% 5.9% 4.9% 3.3% 617.4 546.3 170.0 371.5 78.6 2,458.3 1,656.4 7,822.4 662.8 94.6 2,209.6 4,127.9 $4.73 $1.40 $53.03 9.6% 4.7 34.9% 25.1% 5.9% 5.2% 3.6% 554.3 478.3 153.6 321.6 77.6 2,165.5 1,603.9 7,323.6 573.4 36.8 2,055.1 3,884.4 $4.14 $1.26 $49.99 9.0% 4.8 34.1% 26.0% 6.0% 5.2% 3.5% 661.6 609.4 201.1 403.5 75.7 1,699.2 1,240.7 5,846.7 578.2 84.0 1,113.0 3,567.4 $5.33 $0.80 $46.82 12.8% 3.9 23.6% 26.1% 7.8% 7.2% 4.8% 574.8 511.6 162.4 343.8 75.0 1,698.3 1,105.5 5,592.3 576.4 12.8 1,306.9 3,152.0 $4.58 $0.48 $41.92 12.2% 3.9 28.2% 24.4% 7.1% 6.3% 4.2% 364.6 296.5 98.6 194.4 74.5 1,192.3 1,025.3 4,659.1 508.6 87.0 848.0 254.8 195.5 46.3 148.2 73.7 973.3 981.3 4,293.5 417.6 87.1 839.3 2,830.1 2,608.1 $2.61 $0.40 $37.83 $2.01 $0.40 $35.34 7.5% 3.3 23.3% 25.1% 5.8% 4.7% 3.1% 6.1% 3.3 25.3% 26.3% 4.8% 3.7% 2.8% (1) Operating income represents net sales less cost of sales, warehouse, delivery, selling, general and administrative expense, depreciation and amortization expense and impairment of long-lived assets. The calculation of operating income in years 2012 through 2019 includes various non-recurring charges and credits, including impairment charges in 2019, 2018, 2017, 2016, 2015, 2013 and 2012. Additionally, the adoption of accounting rule changes in 2017 affected the presentation of operating income. Prior year operating income and margin amounts have been retrospectively adjusted to conform to the current presentation. (2) 2017 includes a $207.3 million, or $2.82 per share, income tax benefit as a result of the Tax Cuts and Jobs Act of 2017. (3) Short-term and long-term debt amounts include finance lease obligations. The adoption of accounting rule changes in 2015 affected the presentation of debt issuance costs. Prior year total assets, long-term debt and net debt-to-total capital ratio amounts have been retrospectively adjusted to conform to the current presentation. (4) Book value per share is calculated as Reliance stockholders’ equity divided by the 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 2019, 2018 and 2015, which are adjusted for $50.0 million, $484.9 million and $355.5 million of share repurchases, respectively, and 2017, which is adjusted for a $207.3 million income tax benefit as a result of the Tax Cuts and Jobs Act of 2017. 2 0 2019 ANNUAL REPORTIn millions, except per share data. Year Ended December 31, Income Statement Data: Net sales Operating income(1) Pretax income Income taxes(2) Net income attributable to Reliance(2) Weighted average shares outstanding – diluted Balance Sheet Data (December 31): Current assets Working capital Net fixed assets Total assets(3) Current liabilities Short-term debt(3) Long-term debt(3) Total equity Per Share Data: Earnings – diluted(2) Dividends Book value(4) Ratio Analysis: Current ratio Return on Reliance stockholders’ equity(5) Net debt-to-total capital ratio(6) Gross profit margin(7) Operating income margin(1) Pretax income margin Net income margin – Reliance(2) 1,013.5 929.3 223.2 701.5 67.9 2,334.9 1,795.2 8,131.1 675.3 65.6 1,525.2 5,214.1 $10.34 $2.20 $77.83 15.1% 4.5 21.4% 30.3% 9.2% 8.5% 6.4% 937.5 850.6 208.8 633.7 72.4 2,585.9 1,729.9 8,044.9 699.1 66.8 2,141.1 4,679.5 $8.75 $2.00 $69.83 13.9% 4.7 30.8% 28.4% 8.1% 7.4% 5.5% 662.4 583.8 (37.2) 613.4 73.5 2,347.6 1,656.3 7,751.0 703.7 92.6 1,809.6 4,699.9 $8.34 $1.80 $64.29 9.8% 4.3 27.2% 28.7% 6.8% 6.0% 6.3% 517.8 429.2 120.1 304.3 73.1 2,032.5 1,662.2 7,411.3 656.0 83.1 1,847.2 4,179.1 $4.16 $1.65 $57.07 7.8% 4.1 30.3% 30.1% 6.0% 5.0% 3.5% 2019 2018 2017 2016 2015 2014 2013 2012 2011 2010 2009 $10,973.8 $11,534.5 $9,721.0 $8,613.4 $9,350.5 $10,451.6 $9,223.8 $8,442.3 $8,134.7 $6,312.8 $5,318.1 549.8 458.7 142.5 311.5 74.9 617.4 546.3 170.0 371.5 78.6 554.3 478.3 153.6 321.6 77.6 661.6 609.4 201.1 403.5 75.7 574.8 511.6 162.4 343.8 75.0 364.6 296.5 98.6 194.4 74.5 254.8 195.5 46.3 148.2 73.7 $3,010.2 $3,285.0 $3,051.3 $2,688.5 $2,554.2 $3,121.1 $2,738.9 $2,277.4 $2,274.7 $1,700.9 $1,390.9 1,564.5 1,635.5 7,121.6 989.7 501.3 1,428.9 3,942.7 $4.16 $1.60 $54.59 8.0% 2.6 31.8% 27.2% 5.9% 4.9% 3.3% 2,458.3 1,656.4 7,822.4 662.8 94.6 2,209.6 4,127.9 $4.73 $1.40 $53.03 9.6% 4.7 34.9% 25.1% 5.9% 5.2% 3.6% 2,165.5 1,603.9 7,323.6 573.4 36.8 2,055.1 3,884.4 $4.14 $1.26 $49.99 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 84.0 1,113.0 3,567.4 $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 12.8 1,306.9 3,152.0 $4.58 $0.48 $41.92 12.2% 3.9 28.2% 24.4% 7.1% 6.3% 4.2% 1,192.3 1,025.3 4,659.1 508.6 87.0 848.0 973.3 981.3 4,293.5 417.6 87.1 839.3 2,830.1 2,608.1 $2.61 $0.40 $37.83 $2.01 $0.40 $35.34 7.5% 3.3 23.3% 25.1% 5.8% 4.7% 3.1% 6.1% 3.3 25.3% 26.3% 4.8% 3.7% 2.8% (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). (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-GA AP financial measures as they exclude depreciation and amortization expense associated with the corresponding sales. About half 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 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 above 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. 21 POWERED BY RESILIENCERETURN ON EQUIT Y (% RE TURN) Based on beginning of the year equity. 2019 2018 2017 2016 2015 15%* 14%* 10%* 8% 8%* * Return on Reliance stockholders’ equity is based on the beginning of the year equity amount, except for 2019, 2018 and 2015, which are adjusted for $50.0 million, $484.9 million and $355.5 million of share repurchases, respectively, and 2017, which is adjusted for a $207.3 million income tax benefit as a result of the Tax Cuts and Jobs Act of 2017. FOR THE FUTURE 2 2 2019 ANNUAL REPORTFor 80 years, Reliance has been powered by innovation, people, safety, and service. These key values have propelled the execution of our core strategy – making us North America’s largest metals service center company and placing us on Fortune magazine’s list of top 500 and “World’s Most Admired” companies. Our success belongs to our employees, our customers, our stockholders, and our communities. We strive to evolve and further increase our resilience through focused growth and a commitment to continuous improvement. We believe that our history is the key to writing the story of our future – and that we are just getting started! 2 3 POWERED BY RESILIENCERELIANCE LOCATIONS DI V I S ION 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 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 877-727-6073 Reliance Metalcenter Colorado Springs, CO 719-390-4911 Dallas, TX 817-640-7222 Oakland, CA 510-476-4400 Phoenix, AZ 602-275-4471 Phoenix, AZ 480-986-6156 Salt Lake City, UT 801-974-5300 San Antonio, TX 210-661-2301 24 San Diego, CA 619-263-2141 Reliance Steel Company Albuquerque, NM 505-247-1441 Los Angeles, CA 323-583-6111 Smith Pipe & Steel Company Phoenix, AZ 602-257-9494 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 SUBSIDIARIES All Metal Services Limited A Subsidiary of Reliance Metals UK Holding Limited – Holding Company London, United Kingdom – Headquarters 44 18 9544 4066 Belfast, United Kingdom 44 28 9073 9648 Birmingham, United Kingdom 44 16 7543 0307 Bolton, United Kingdom 44 19 4284 0777 Bristol, United Kingdom 44 11 7982 2484 Losse, France 33 558 936 800 Minworth, United Kingdom 44 16 7543 0307 Slough, United Kingdom – Sales Office 44 20 7318 5066 All Metal Services India Private Limited A Subsidiary of All Metal Services Limited Belagavi, India 91 80 2837 9124 All Metal Services Ltd. (Xi’an) A Subsidiary of All Metal Services Limited Xi’an, People’s Republic of China 86 29 8612 5300 All Metal Services (Malaysia) Sdn. Bhd. A Subsidiary of All Metal Services Limited Selangor Darul Ehsan, Malaysia 60 3 7803 5643 All Metals Processing & Logistics, Inc. Spartanburg, SC – Headquarters 864-574-8050 Cartersville, GA 770-427-7379 All Metals Transportation and Logistics, Inc. Decatur, AL 877-877-7528 Allegheny Steel Distributors, Inc. Pittsburgh, PA 412-767-5000 American Metals Corporation Doing Business as American Steel Portland, OR – Headquarters 503-651-6700 Fresno, CA 559-266-0881 Sacramento, CA 916-371-7700 Seattle, WA 253-437-4080 Haskins Steel Company A Division of American Metals Corporation Spokane, WA 509-535-0657 Lampros Steel A Division of American Metals Corporation Portland, OR 503-285-6667 LSI Plate A Division of American Metals Corporation Rancho Cucamonga, CA 877-877-7528 Alaska Steel Company A Subsidiary of American Metals Corporation Anchorage, AK – Headquarters 907-561-1188 2019 ANNUAL REPORT Fairbanks, AK 907-456-2719 Kenai, AK 907-283-3880 AMI Metals, Inc. Nashville, TN – Headquarters 615-377-0400 Fort Worth, TX 817-831-9586 Los Angeles, CA 909-429-1336 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 Elk Grove Village, IL 847-238-9265 Newark, NJ 973-588-1100 Continental Alloys & Services Inc. Houston, TX – Headquarters 281-376-9600 Chapel Steel Corp. Philadelphia, PA – Corporate Office 215-793-0899 Lafayette, L A 337-837-9311 Birmingham, AL 205-781-0317 Seattle, WA – Sales Office 253-735-0181 Birmingham, AL – Sales Office 800-641-1006 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 – Headquarters 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 Doing Business as Airport Metals (Australia) Melbourne, Australia 61 3 9310 5566 Chicago, IL 815-937-1970 Chicago, IL – Sales Office 708-429-2244 Cleveland, OH 216-446-6840 Houston, TX 713-462-4449 Philadelphia, PA 610-705-0477 Portland, OR 503-228-3355 Tulsa, OK 844-964-0335 Chapel Steel Canada, Ltd. A Subsidiary of Reliance Metals Canada Holdings Limited – Holding Company Hamilton, Ontario, Canada 289-780-0570 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 Continental Alloys & Services, Inc. A Subsidiary of Reliance Metals Canada Holding Limited — Holding Company Calgary, Alberta, Canada 403-216-5150 Continental Alloys & Services Limited A Subsidiary of Reliance Metals UK Holding Limited — Holding Company Brechin, Scotland 44 135 662 5515 Peterhead, Scotland 44 177 948 0420 Continental Alloys & Services Pte. Ltd. A Subsidiary of Reliance Asia Holding Pte. Ltd. — Holding Company Jurong, Singapore 65 6690 0178 Continental Alloys & Services (Malaysia) Sdn. Bhd. A Subsidiary of Continental Alloys & Services Pte. Ltd. Senai, Johor, Malaysia 60 7 599 9975 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 817-293-5015 Chicago, IL 708-757-7198 Fort Worth, TX 817-293-5015 San Antonio, TX 210-661-4641 2 5 POWERED BY RESILIENCE Diamond Manufacturing Company Wyoming, PA – Headquarters 800-233-9601 Cedar Hill, TX 972-291-8800 Michigan City, IN 219-874-2374 McKey Perforating Co. A Division of Diamond Manufacturing Company New Berlin, WI 800-532-7373 Manchester, TN 931-723-3636 Perforated Metals Plus A Division of Diamond Manufacturing Company Charlotte, NC 704-598-0443 Ferguson Perforating Company A Subsidiary of Diamond Manufacturing Company Providence, RI – Headquarters 401-941-8876 New Castle, PA 724-657-8703 DuBose National Energy Fasteners & Machined Parts, Inc. Cleveland, OH 216-362-1700 DuBose National Energy Services, Inc. Clinton, NC – Headquarters 910-590-2151 Charlotte, NC – Sales Office 704-295-1060 Exton, PA – Sales Office 610-594-9413 Durrett Sheppard Steel Co., Inc. Baltimore, MD 410-633-6800 Earle M. Jorgensen Company Los Angeles, CA – Headquarters 323-567-1122 Atlanta, GA 678-894-2500 Birmingham, AL 205-814-0043 Boise, ID 503-283-2251 Boston, MA 508-435-6854 2 6 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 508-435-6854 Houston, TX 713-672-1621 Indianapolis, IN 317-838-8899 Kansas City, MO 816-483-4140 Lafayette, L A 713-672-1621 Memphis, TN 901-317-4300 Minneapolis, MN 763-784-5000 Oakland, CA 510-487-2700 Orlando, FL 800-365-5454 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 330-425-1500 Salt Lake City, UT 801-532-2543 Seattle, WA 253-872-0100 St. Louis, MO 314-291-6080 Tulsa, OK 918-835-1511 Wrightsville, PA 215-949-2850 Encore Metals USA A Division of Earle M. Jorgensen Company Portland, OR 503-620-8810 Salt Lake City, UT 801-383-3808 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 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 2019 ANNUAL REPORT 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 FastMetals, Inc. Massillon, OH 833-327-8685 Feralloy Corporation Chicago, IL – Corporate Office 773-380-1500 Charleston, SC 843-336-4107 Decatur, AL 256-301-0500 Portage, IN 219-787-9698 Acero Prime, S. de R.L. de C.V. A Subsidiary of Feralloy Corporation San Luis Potosí, 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 GH Metal Solutions, Inc. A Subsidiary of Feralloy Corporation Fort Payne, AL – Headquarters 256-845-5411 Charleston, SC 843-336-4107 Decatur, AL 256-845-5411 Fort Payne, AL (East) 256-845-5411 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 Fry Steel Company Santa Fe Springs, CA 562-802-2721 Infra-Metals Co. Wallingford, CT – Headquarters 203-294-2980 Philadelphia, PA – Corporate Office 215-741-1000 Atlanta, GA 404-419-3460 Baltimore, MD 410-355-1664 Hallandale, FL 954-454-1564 Marseilles, IL 815-795-5002 New Boston,OH 740-353-1350 Petersburg, VA 804-957-5900 Tampa, FL 813-626-6005 Athens Steel A Division of Infra-Metals Co. Athens, GA 706-552-3850 IMS Steel A Division of Infra-Metals Co. Atlanta, GA 404-419-3460 KMS FAB, LLC Luzerne, PA 570-338-0200 KMS South, Inc. W. Columbia, SC 803-796-9995 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 – Headquarters 309-699-7251 Liebovich Steel & Aluminum Company A Division of Liebovich Bros., Inc. Rockford, IL – Headquarters 815-987-3200 Cedar Rapids, IA 800-373-7956 Green Bay, WI 800-646-2790 Rockford, IL 815-964-9471 Rockford, IL 815-874-8536 Metals USA, Inc. Metals USA Carbon Flat Rolled, Inc. A Subsidiary of Metals USA, Inc. Northbrook, IL – Headquarters 847-291-2400 Germantown, WI 262-255-4444 Horicon, WI 920-485-9750 Liberty, MO 816-415-0004 Randleman, NC 336-498-8900 Springfield, OH 937-882-6354 Walker, MI 616-453-9845 Wooster, OH 330-264-8416 Lynch Metals A Division of Metals USA Carbon Flat Rolled, Inc. Union, NJ – Headquarters 908-686-8401 Anaheim, CA 714-238-7240 Ohio River Metal Services, Inc. A Subsidiary of Metals USA Carbon Flat Rolled, Inc. Jeffersonville, IN 812-282-4770 Metals USA Plates and Shapes, Inc. A Subsidiary of Metals USA, Inc. Langhorne, PA – Headquarters 267-580-2100 27 POWERED BY RESILIENCE Ambridge, PA 724-266-7708 Bethlehem, PA 610-691-4270 Fairless Hills, PA 215-337-7000 Greensboro, NC 336-674-7991 Jacksonville, FL 904-766-0003 Mobile, AL 251-456-4531 Newark, NJ 973-242-1000 Oakwood, GA 770-536-1214 Philadelphia, PA 215-673-9300 Seekonk, MA 508-399-8500 Waggaman, L A 504-431-7010 York, PA 717-757-3549 Gregor Technologies, LLC A Subsidiary of Metals USA Plates and Shapes, Inc. Torrington, CT 860-482-2569 Metals USA Plates and Shapes Southcentral, Inc. A Subsidiary of Metals USA, Inc. Enid, OK 580-233-0411 Muskogee, OK 918-487-6800 Tulsa, OK 918-583-2222 The Richardson Trident Company, LLC A Subsidiary of Metals USA Plates and Shapes Southcentral, Inc. Richardson, TX – Headquarters 972-231-5176 Odessa, TX 432-561-5446 Tulsa, OK 918-252-5781 44 121 328 7700 London, United Kingdom 44 199 245 0300 Manchester, United Kingdom 44 161 483 9662 National Specialty Alloys, Inc. Houston, TX – Headquarters 281-345-2115 Anaheim, CA 714-870-7800 Buford, GA 770-945-9255 Aleaciones Especiales de México, S. de R.L. de C.V. A Subsidiary of National Specialty Alloys, Inc. Cuautitlán, 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 408-988-3000 Stockton, CA 209-943-0513 Vancouver, WA 360-225-1133 Feralloy PDM Steel Service 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 Birmingham, AL 205-841-7477 Charlotte, NC 704-588-7075 Cincinnati, OH 513-727-4763 Fort Smith, AR 479-452-3802 Hammond, IN 513-727-4763 Kansas City, KS 913-321-5200 Nashville, TN 931-486-1456 Philadelphia, PA 215-295-9512 Richmond, VA 804-222-5052 St. Louis, MO 636-379-4050 Tampa, FL 813-626-8999 PDM Steel Service Centers, Inc. Elk Grove, CA – Headquarters 916-513-4548 Denver, CO 303-297-1456 Fresno, CA 209-943-0513 Aluminum & Stainless A Division of Phoenix Corporation Lafayette, L A 337-837-4381 New Orleans, L A 504-586-9191 Grand Junction, CO – Sales Office 970-858-3441 Precision Flamecutting and Steel, Inc. Houston, TX 281-477-1600 Altair Electronics, LLC A Subsidiary of The Richardson Trident Company, LLC Richardson, TX 972-231-5176 Metalweb Limited Birmingham, United Kingdom – Headquarters Las Vegas, NV 702-413-0067 Provo, UT 801-798-8676 Reno, NV 775-358-1441 Santa Clara, CA 2 8 Precision Strip Inc. Minster, OH – Headquarters 419-628-2343 Bowling Green, KY 270-282-8420 Dayton, OH 2019 ANNUAL REPORTViking Materials, Inc. Minneapolis, MN – Headquarters 612-617-5800 Chicago, IL 847-451-7171 Yarde Metals, Inc. Southington, CT – Headquarters 860-406-6061 East Hanover, NJ 973-463-1166 Greensboro, NC 336-500-0535 Hauppauge, NY 631-232-1600 Limerick, PA 610-495-7545 North Canton, OH 330-342-7020 Pelham, NH 603-635-1266 937-667-6255 Indianapolis, IN 765-778-4452 Kenton, OH 419-674-4186 Middletown, OH 513-423-4166 Portage, IN 219-850-5080 Rockport, IN 812-362-6480 Talladega, AL 256-315-2345 Toledo, OH 419-661-1100 Vonore, TN 423-271-3690 Woodburn, KY 270-542-6100 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 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 Co. 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 Perrysburg, OH 419-661-8500 Sunbelt Steel Texas, Inc. Houston, TX – Headquarters 713-937-4300 Lafayette, L A 337-330-4140 Tubular Steel, Inc. St. Louis, MO – Headquarters 314-851-9200 Katy, TX 281-371-5200 Hazelwood, MO 314-524-6600 Lorain, OH 440-960-6100 New Haven, MO 800-325-0890 Rialto, CA 909-429-6900 Savannah, GA 912-748-2405 Staunton, IL 618-635-3695 Valex Corp. Ventura, CA 805-658-0944 Valex Semiconductor Materials (Zhejiang) Co., Ltd. A Subsidiary of Valex Corp. Haiyan Economic Development Zone, People’s Republic of China 86 21 5818 3189 Valex Korea Co., Ltd. A 96% Owned Subsidiary of Valex Corp. Seoul, Republic of Korea 82 31 683 0119 2 9 POWERED BY RESILIENCE CORPORATE DIRECTORY Corporate Information DIR E C T OR S OF F IC ER S James D. Hoffman President and Chief Executive Officer Karla R. Lewis Senior Executive Vice President and Chief Financial Officer William K. Sales, Jr. Executive Vice President, Operations Jeffrey W. Durham Senior 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, Corporate Controller Suzanne M. Bonner Vice President, Chief Information Officer Brenda S. Miyamoto Vice President, Corporate Initiatives Donald J. Prebola Vice President, Health and Human Resources John A. Shatkus Vice President, Internal Audit Silva Yeghyayan Vice President, Tax Mark V. Kaminski (1), (2) Chairman of the Board Executive Chairman and Director Graniterock Sarah J. Anderson (1), (2), (4) Former Partner Ernst & Young LLP Lisa Baldwin (1), (2) Chief Information Officer Tiffany & Co. Karen W. Colonias (1), (2), (3) President and Chief Executive Officer Simpson Manufacturing Co., Inc. John G. Figueroa (1), (3), (4) Chairman and Chief Executive Officer Carepathrx David H. Hannah Former Executive Chairman of the Board Reliance Steel & Aluminum Co. James D. Hoffman President and Chief Executive Officer Reliance Steel & Aluminum Co. Robert A. McEvoy (1), (3), (4) Former Managing Director Goldman Sachs Andrew G. Sharkey, III (1), (3), (4) Former President and Chief Executive Officer American Iron and Steel Institute Douglas W. Stotlar (1), (2), (4) Former President and Chief Executive Officer Con-way Inc. (1) Independent Director (2) Member of the Audit Committee (3) Member of the Compensation Committee (4) Member of the Nominating and Governance Committee 3 0 2019 ANNUAL REPORTCORPORATE INFORMATION TRANSFER AGENT & REGISTRAR American Stock Transfer & Trust Company 6201 15th Avenue Brooklyn, NY 11219 800-937-5449 718-921-8124 www.amstock.com INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM KPMG LLP Los Angeles, CA RELIANCE STEEL & ALUMINUM CO. CORPORATE HEADQUARTERS 350 South Grand Avenue Suite 5100 Los Angeles, CA 90071 213-687-7700 www.rsac.com SECURITIES LISTING Reliance Steel & Aluminum Co.’s common stock is traded on the New York Stock Exchange under the symbol “RS.” MARKET PRICE OF COMMON STOCK The high and low sales prices for the Company’s common stock in 2019 were $121.33 and $69.70. The following table sets forth the high and low sales prices of the Company’s common stock for the stated calendar quarters. 2019 1Q 2Q 3Q 4Q LOW HIGH $69.70 $90.66 $83.27 $94.62 $103.74 $90.81 $121.33 $97.10 FORM 10-K A copy of the Annual Report on Form 10-K, filed with the United States Securities and Exchange Commission, is available at: https://www.sec.gov/ or https://investor.rsac.com/ or upon request to: STOCKHOLDERS OF RECORD AND DIVIDEND POLICY As of February 21, 2020, there were 182 record holders of our common stock. We have paid quarterly cash dividends on our common stock for 60 consecutive years. Our Board of Directors has increased the quarterly dividend rate on a periodic basis 27 times since our IPO in 1994. Karla R. Lewis Senior Executive Vice President and Chief Financial Officer Reliance Steel & Aluminum Co. 350 South Grand Avenue Suite 5100 Los Angeles, CA 90071 INVESTOR RELATIONS CONTACT Brenda S. Miyamoto 213-576-2428 investor@rsac.com FORWARD-LOOKING STATEMENTS This Annual Report includes statements that, to the extent they are not recitations of historical fact, may constitute forward-looking statements within the meanng of the federal securities laws, and are based on Reliance’s current expectations and assumptions. For a discussion identifying important factors that could cause actual results to vary materially from those anticipated in the forward-looking statements, see Reliance’s 2019 annual report on Form 10-K. As a result, these statements speak only as of the date that they are made, and Reliance disclaims any and all obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise. 350 SOUTH GRAND AVENUE, SUITE 5100 | LOS ANGELES, CA 90071 | 213-687-7700 | WWW.RSAC.COM 

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