Reliance Steel (RS) Tops Q1 EPS by 29c, Beats on Revenues

Reliance Steel (NYSE: RS) reported Q1 EPS of $2.30, $0.29 better than the analyst estimate of $2.01. Revenue for the quarter came in at $2.76 billion versus the consensus estimate of $2.69 billion.

First Quarter 2018 Financial Highlights

• Net sales of $2.76 billion set a new Company record, and were up 14.0% from $2.42 billion in the first quarter of 2017 and up 16.0% from $2.38 billion in the fourth quarter of 2017.
• Tons sold were a record at 1.6 million tons, up 3.6% from the first quarter of 2017 and up 10.0% from the fourth quarter of 2017, with the average selling price per ton sold up 10.3% from the first quarter of 2017 and up 5.6% from the fourth quarter of 2017.
• Gross profit dollars were a record $819.9 million with a gross profit margin of 29.7%, compared to 29.8% in the first quarter of 2017 and 28.6% in the fourth quarter of 2017. FIFO gross profit margin was 30.6%, compared to 30.2% in the first quarter of 2017 and 28.7% in the fourth quarter of 2017.
• Net income attributable to Reliance was $169.0 million, compared to $111.7 million in the first quarter of 2017 and $301.4 million in the fourth quarter of 2017. Net income attributable to Reliance in the fourth quarter of 2017 included a provisional/one-time income tax benefit of $207.3 million as a result of the December 2017 Tax Cuts and Jobs Act (“Tax Reform”).
• Earnings per diluted share were $2.30, compared to $1.52 in the first quarter of 2017 and $4.09 in the fourth quarter of 2017. Excluding the impact of Tax Reform, earnings per diluted share were $1.28 for the fourth quarter of 2017.
• Non-GAAP earnings per diluted share were $2.30, up 51.3% from $1.52 in the first quarter of 2017 and up 88.5% from $1.22 in the fourth quarter of 2017.
• The effective tax rate was 24.0%, compared to 32.7% in the first quarter of 2017 and 20.0%, excluding the impact of Tax Reform, in the fourth quarter of 2017.
• Cost of sales includes a pre-tax net LIFO inventory valuation charge, or expense, of $25.0 million in the first quarter of 2018, compared to $10.0 million in the first quarter of 2017 and $4.5 million in the fourth quarter of 2017.
• Cash flow from operations was $13.3 million in the first quarter of 2018 and net debt-to-total capital was 28.6% at March 31, 2018.
• Reliance repurchased $50.0 million of its common stock, or 0.6 million shares, at an average cost of $84.38 per share during the first quarter of 2018, and $25.0 million in the fourth quarter of 2017.
• A quarterly cash dividend of $0.50 per share was declared on April 25, 2018 for stockholders of record as of May 25, 2018 and will be payable on June 15, 2018.

For earnings history and earnings-related data on Reliance Steel (RS) click here.

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