Ryerson (RYZ) Q2 2024 earnings summary

Executive summary

• Q2 2024 net income was $9.9 million, with adjusted EBITDA excluding LIFO at $42.6 million and diluted EPS of $0.29 on $1.23 billion revenue from 508,000 tons shipped; operating expenses reduced by $17.8 million sequentially, and annualized cost savings target raised to $60 million.

• Inventory reduced by $107.1 million on a FIFO basis compared to Q1 2024.

• $20.4 million returned to shareholders in Q2 via $14 million in share repurchases and $6.4 million in dividends; share repurchase authorization increased by $50 million and extended to April 2026.

• Industry conditions remain challenging with declining metals prices, contracting industrial demand, and countercyclical pressures.

• Investments in network modernization and digital platforms continued, with operational improvements in service levels, lead times, and inventory availability.

Financial highlights

• Q2 2024 revenue was $1.23 billion, down 1.1% sequentially and 8.8% year-over-year, driven by lower average selling prices despite higher volumes.

• Gross margin for Q2 2024 was 18.2% (including LIFO), down from 19.4% in Q2 2023; excluding LIFO, gross margin was 17.4%.

• Adjusted EBITDA excluding LIFO was $42.6 million, up from $40.2 million in Q1 but down from $70.1 million in Q2 2023.

• Net debt at quarter-end was $497 million, up from $455 million in Q1 2024; total debt at $525 million.

• Achieved $26 million in operating cash flow for the quarter; free cash flow for Q2 2024 was $3.3 million.

Outlook and guidance

• Q3 2024 revenue expected between $1.12 billion and $1.16 billion; adjusted EBITDA excluding LIFO of $21–$25 million; EPS guidance $0.01–$0.10 per diluted share.

• Q3 2024 shipments expected to decrease 2%–4% sequentially; average selling prices anticipated to decline 3%–5%.

• Management anticipates continued market softness, with cyclical bottoming in the second half and ongoing focus on cost reduction and investment optimization.

• LIFO income for Q3 2024 forecasted at $12 million.

• Board declared Q3 2024 dividend of $0.1875 per share.