Reliance Steel & Aluminum Co

Greetings and welcome to the Reliance Inc. fourth quarter 2025 earnings call. At this time, all participants are in a listen-only mode. A brief question and answer session will follow the formal presentation. Should anyone require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Kim Orlando, with Investor Relations. Thank you. You may begin.

Thank you, Operator. Good morning, and thanks to all of you for joining our conference call to discuss Reliance's fourth quarter and full year 2025 financial results. I am joined by Carla Lewis, President and Chief Executive Officer, Steve Cook, Executive Vice President and Chief Operating Officer, and Arthur Jemmian, Senior Vice President and Chief Financial Officer. A recording of this call will be posted on the Investors section of our website at investor.reliance.com. Please read the forward-looking statement disclosures included in our earnings release issued yesterday and note that it applies to all statements made during this teleconference. The reconciliations of the adjusted numbers are included in the non-GAAP reconciliation part of our earnings release. I will now turn the call over to Carla Lewis, President and CEO of Reliance.

Good morning, everyone, and thank you for joining us to discuss our fourth quarter and full year 2025 results. In 2025, we demonstrated strong operational execution and continued to expand our market share, underscoring the strength of our business model amid a complex macroeconomic backdrop and competitive operating environment. Our commitment to smart, profitable growth once again fueled strong results. In 2025, we increased our ton shipped by 6.2%, resulting in record tons sold of 6.4 million, outperforming the industry by over 7 percentage points, with our U.S. market share increasing to approximately 17% in 2025, from 15% in 2024. In addition, we increased our tolling tons by 1.2% to 7.4 million customer-owned tons processed through our tolling operations. Our shipment growth was in carbon long and flat rolled products, where we also increased our gross profit margin year over year. By continuing to focus on exceptional customer service and maintaining our strong relationships with key domestic suppliers, we were successful winning new business and were able to better leverage our operating expenses over higher volumes, leading to increased FIFO profits that further strengthen our long-term industry-leading position. We increased our FIFO gross profit margin by 90 basis points in 2025 compared to 2024 through strong pricing discipline, mainly on increased mill prices for carbon products supported by healthy demand. However, significant tariff-related aluminum cost increases were more difficult to pass through due to plentiful supply and soft demand, especially in our commercial aerospace and semiconductor markets. Our 2025 non-GAAP gross profit margin of 28.8% is just outside of our estimated sustainable range, which we attribute primarily to tariff-driven annual LIFO expense of $114 million. We expect our gross profit margin to improve in 2026 as the impact of tariffs and trade uncertainty lessens, maintaining our annual range of 29 to 31%. We increased 2025 non-GAAP FIFO pre-tax income by $80 million. However, full-year 2025 earnings per diluted share declined 10.2% from 2024. Excluding the impact of significant LIFO adjustments in both periods, 2025 non-GAAP FIFO earnings per diluted share increased 13.5% year over year, thanks to the talented teams we have throughout the Reliance family. Our strong cash flow generation continues to fuel profitable growth and deliver meaningful returns to our stockholders. In 2025, we generated $831 million in operating cash flow, which we redeployed into high-value initiatives, including investments in advanced processing equipment, and other projects that support our long-term growth objectives. For 2026, we're announcing a capital expenditure budget of $275 million as we focus on maximizing returns on the significant capital deployed in recent years. Including carryover spending, we anticipate 2026 total capex spending of $300 to $325 million with approximately half directed toward growth initiatives. Our scale, financial strength, and operational capabilities position us to pursue compelling opportunities that may emerge in 2026, including acquisitions of well-run profitable businesses that broaden our footprint and strengthen our portfolio of metal solutions, and through additional capital expenditure investments, as attractive customer opportunities arise. We also remain committed to returning capital to our stockholders, delivering $849 million in 2025 through dividends and share repurchases. We increased our dividend by 4% to an annual dividend rate of $5 per share in the 2026 first quarter. In summary, Reliance's diversified business model and unrivaled scale help to offset market-specific weaknesses and support stable performance through economic cycles. Our expansive capabilities and financial strength enable us to invest when others retreat, positioning us to capture market share and accelerate growth as markets stabilize and improve. As we entered 2026 in a healthy demand and strong pricing environment, we are seeing increasing optimism from our customers and increasing activity around large-scale projects across several key end markets, including infrastructure, data centers, energy, and defense. Reliance has the capabilities, talent, and capital to continue to grow both our core small-order, quick-turn business, while also winning new business from these larger projects. We are excited to continue delivering disciplined, profitable growth in the year ahead. I'll now turn the call over to our COO, Steve, who will review our demand and pricing trends.