Olympic Steel, Inc.

Good morning and welcome to the Olympic Steel 2022 Third Quarter Financial Results Conference Call. At this time, all participants are in listen-only mode. A brief question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, please, this conference is being recorded. I would now like to hand the conference over to Rich Manson, Chief Financial Officer at the Olympic Steel. Please go ahead, sir.

Thank you, Operator. Welcome to Olympic Steel's earnings call for the third quarter of 2022. Our call this morning will be hosted by our Chief Executive Officer, Rick Mirabito, and we will also be joined by our President and Chief Operating Officer, Andrew Greif. Before we begin, I have a few reminders. Some statements made on today's call will be predictive and are intended to be made as forward-looking within the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 and may not reflect actual results. The company does not undertake to update such statements, changes in assumptions, or changes in other factors affecting such forward-looking statements. Important assumptions, risks, uncertainties, and other factors that could cause actual results to differ materially are set forth in the company's reports on Forms 10-K and 10-Q and the press releases filed with the Securities and Exchange Commission. During today's discussion, we may refer to adjusted net income per diluted share, EBITDA, and adjusted EBITDA, which are all non-GAAP financial measures. A reconciliation of these non-GAAP measures to the most directly comparable GAAP financial measures is provided in the press release that was issued yesterday and can be found on our website. Today's live broadcast will be archived and available for replay on Olympic Steel's website. At this time, I'll turn the call over to Rick.

Thank you, Rich, and good morning, everyone. Thank you for joining us today to discuss Olympic Steel's results for the third quarter of 2022. I'll begin with some overall comments on our business and our third quarter performance, and then I'll turn the call over to Andrew, who will review highlights for each of our segments and provide some comments on our market outlook. Following that, Rich will discuss our financial results in more detail and then, as always, we'll take your questions. Market dynamics in the steel industry have certainly shifted dramatically since this time last year. We have seen metals pricing significantly decline across the board. Hot roll pricing has fallen by more than 50% since its peak in April. While overall market demand has been consistent, it remains impacted by macroeconomic concerns such as inflation, rising interest rates, the overall speculation of a recession, and persistent non-steel-related supply chain and labor issues. Despite this remarkable shift, Olympic Steel continues to perform well. We delivered sales of $634 million, and adjusted EBITDA of $25.3 million for the third quarter of 2022, while simultaneously strengthening our balance sheet. Strong cash flows have resulted in an $84 million, or 26%, reduction in our outstanding debt so far this year. Our performance in the face of tough market conditions is further evidence that our diversification strategy has better positioned Olympic to succeed in all market cycles. We are a stronger and less cyclical organization today as compared to past declining price markets. Our growth and higher return, value add products and services, coupled with our sustained operational disciplines around inventory, costs, and investment criteria, has allowed our business to thrive despite historic price declines and market challenges. Our team has worked diligently to execute on the strategy and strengthen our business. We have completed five successful acquisitions and made targeted organic investments in all three of our business segments to increase our capacity and enhance our efficiency. At the same time, we evaluated our portfolio and identified areas that no longer aligned with our vision for the company including the decision to divest of our Detroit division in September 2021. We also took a hard look at our operations and implemented measures to improve inventory turnover and permanently right-size our cost profile. And we would not have made this progress without the right team and leadership in place. And our work is not done. We anticipate continued strong cash flows and further debt reduction in the fourth quarter. We have significant liquidity and continue to actively pursue acquisitions and invest in new equipment and efficiencies through automation, which Andrew will highlight in a moment. While we expect the macroeconomic challenges and declining metal pricing will remain a short-term headwind, we are well positioned as a company and we are confident in the future of Olympic Steel to deliver value to our shareholders. Finally, Our board of directors approved a regular quarterly dividend of 9 cents per share. That's payable on December 15th, 2022 to shareholders of record on December 1st, 2022. Olympic has now paid a regular quarterly dividend for 17 consecutive years. And as a reminder, we increased our dividend from 2 cents per share to 9 cents per share this past March. With that, I'll turn the call over to Andrew to provide an overview of our segments and what we're seeing in the market as we approach year end.