Ryerson Holding Corp (RYI) Q3 2024 Earnings Call Highlights: Navigating Challenges with ...

GuruFocus News
3 min read

In This Article:

  • Revenue: $1.13 billion, meeting the low end of guidance expectations.

  • Average Selling Price: $2,323 per ton, within guidance expectations.

  • Sales Volume: 485,000 tons, below guidance range.

  • Net Loss: $6.6 million, or $0.20 loss per diluted share.

  • Free Cash Flow: $103 million generated in the quarter.

  • Capital Returned to Shareholders: $42 million, including $36 million in share repurchases and $6 million in dividends.

  • Gross Margin: 17.9%, contracted by 30 basis points from the prior quarter.

  • Adjusted EBITDA Excluding LIFO: $21 million, compared to $42.6 million in the prior quarter.

  • Total Debt: $522 million, with net debt at $487 million.

  • Available Global Liquidity: $491 million, decreased from $585 million in the second quarter.

  • Capital Expenditures: $32 million, including modernization and expansion projects.

  • Net Leverage: 3.8 times, above the target range of 2 times.

Release Date: October 30, 2024

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

  • Ryerson Holding Corp (NYSE:RYI) generated $103 million in free cash flow during the third quarter.

  • The company returned $42 million to shareholders, including $36 million in share repurchases and $6 million in dividends.

  • Ryerson Holding Corp (NYSE:RYI) is seeing improvements in service levels, positive account turn, and on-time delivery.

  • The company is making strategic investments in modernization and automation, such as the Shelbyville, Kentucky facility, to enhance productivity and customer experience.

  • Ryerson Holding Corp (NYSE:RYI) is optimistic about moving off the cyclical bottoming and anticipates improved conditions in 2025.

Negative Points

  • Ryerson Holding Corp (NYSE:RYI) experienced a net loss of $6.6 million and a diluted loss per share of $0.20 in the third quarter.

  • Sales volume of 485,000 tons was below guidance due to a slow demand environment and impacts from Hurricane Helene.

  • Average selling prices decreased, with carbon products seeing a 6% drop, contributing to margin compression.

  • The company ended the quarter with a net leverage of 3.8 times, above its target range of 2 times.

  • Ryerson Holding Corp (NYSE:RYI) anticipates a further 8% to 10% sequential decline in volumes for the fourth quarter.

Q & A Highlights

Q: Of the $60 million in cost savings you're targeting, how much has already been realized so far? A: James Claussen, CFO, explained that the heavy lifting in expense reductions has been done, with further optimization possible as automation is implemented. The trend in expense per ton has been decreasing from the first to the third quarter.

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