Commercial Metals (CMC) DEFA14A Additional proxy soliciting materials

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 14A

(Rule 14a-101)

INFORMATION REQUIRED IN PROXY STATEMENT

SCHEDULE 14A INFORMATION

Proxy Statement Pursuant to Section 14(a) of the Securities

Exchange Act of 1934 (Amendment No.    )

Filed by the Registrant  x                            Filed by a Party other than the Registrant  ¨

Check the appropriate box:

¨	Preliminary Proxy Statement
¨	Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))
¨	Definitive Proxy Statement
x	Definitive Additional Materials
¨	Soliciting Material Pursuant to §240.14a-12
COMMERCIAL METALS COMPANY
(Name of Registrant as Specified In Its Charter)
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
x	No fee required.
¨	Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
	(1)	Title of each class of securities to which transaction applies:
	(2)	Aggregate number of securities to which transaction applies:
	(3)	Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is calculated and state how it was determined):
	(4)	Proposed maximum aggregate value of transaction:
	(5)	Total fee paid:
¨	Fee paid previously with preliminary materials.
¨	Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing.
	(1)	Amount Previously Paid:
	(2)	Form, Schedule or Registration Statement No.:
	(3)	Filing Party:
	(4)	Date Filed:

Change You Can Count On

January 10, 2012

Cautionary Statements

This

written

and

verbal

presentation

may

contain

forward-looking

statements

regarding

the

outlook

for

the

Company’s financial results, including net earnings (loss), operating profit (loss), economic conditions, credit

availability, product pricing and demand, currency valuation, production rates, interest rates, inventory levels,

margins, acquisitions, construction and operation of new facilities and general market conditions. These

forward-looking statements generally can generally be identified by words such as “expects,”

“anticipates,”

“believes,”

“estimates,”

“intends,”

“plans to,”

“ought,”

“could,”

“will,”

“should,”

“likely,”

“appears,”

“projects,”

“forecasts,”

or

other similar words or phrases. There are inherent risks and uncertainties in any forward-looking statement. Although

the Company believes that its expectations are reasonable, it can give no assurance that these expectations will prove

to have been correct, and actual results may vary materially. Except as required by law, the Company undertakes no

obligation to update, amend or clarify any forward-looking statements to reflect events, new information or

otherwise.

Developments that could impact the Company's expectations include the following: absence of global economic

recovery or possible recession relapse; solvency of financial institutions and their ability or willingness to lend; success

or failure of governmental efforts to stimulate the economy, including restoring credit availability and confidence in a

recovery; continued sovereign debt problems in Greece and other countries within the euro zone and other foreign

zones; customer non-compliance with contracts; construction activity or lack thereof; decisions by governments

affecting the level of steel imports, including tariffs and duties; litigation claims and settlements; difficulties or delays

in the execution of construction contracts resulting in cost overruns or contract disputes; metals pricing over which

the Company exerts little influence; increased capacity and product availability from competing steel minimills and

other steel suppliers, including import quantities and pricing; execution of cost minimization strategies; ability to

retain key executives; court decisions and regulatory rulings; industry consolidation or changes in production capacity

or utilization; global factors, including political and military

uncertainties; currency fluctuations; interest rate changes;

availability and pricing of raw materials including scrap metal,

energy, insurance and supply prices; passage of new, or

interpretation of existing, environmental laws and regulations; severe weather, especially in Poland; the pace of

overall economic activity, particularly in China; and business disruptions, costs and future events related to the tender

offer and proxy contest initiated by Carl C. Icahn and affiliated entities.

Important Additional Information

CMC’s stockholders are strongly advised to carefully read CMC’s solicitation/recommendation statement on Schedule

14D-9, which was filed with the U.S. Securities and Exchange Commission (the “SEC”) on December 19, 2011, and any

amendments or supplements thereto. CMC’s solicitation/recommendation statement sets forth the reasons for the

recommendation of CMC’s Board of Directors and related information. Free copies of the

solicitation/recommendation statement are available at the SEC’s web site at www.sec.gov, or at the CMC web site at

www.cmc.com or by writing to CMC at 6565 N. MacArthur Blvd., Suite 800, Irving, Texas 75039, Attn: Corporate

Secretary.

Agenda

•

CMC: Global, Low-Cost, Vertically Integrated

•

The CMC Growth Story

•

Why Our Team is the Right Team

•

Why We Rejected Icahn’s Bargain Basement Offer

•

Conclusion

1

CMC: Global, Low-Cost,

Vertically Integrated

CMC Recycles, Manufactures, Markets and Distributes Steel

Products and Related Raw Materials

We Are a Global, Low-Cost, Vertically

Integrated Steel Producer

FY 2011 Revenue: $7.9 Billion vs. $6.3 Billion FY 2010

3.7 M tons Captive Scrap Recycling

1.5 M tons Fabricating

4.7 M tons Steelmaking Capacity

1.9 M tons Processing & Distribution

Source: Company internal data

3

Fabrication

Mills

We Operate a Highly Integrated Global

Manufacturing

Platform

~40% of Recycling product

is supplied to Mills

Mills supplies ~80% of

Fabrication’s raw materials

Recycling

Electric Arc Furnace Metals Value Chain

Sourcing of low

cost raw materials

Competitive

market sourcing

Efficient high

productivity mills

4

Distribution

Finished

Marketing

&

Distribution

is

an

Integral

Part

of Our Business

Raw Materials

Our Marketing & Distribution business allows us to leverage

our global partners and develop a deep knowledge of the

supply chain and end use markets

“Marketing/Distribution

division

is

an

underappreciated

(and

undervalued)

asset that gives the company more exposure to global markets.”

Aldo Mazzaferro, Macquarie, November 29, 2011

5

Note: Permission to use quotations neither sought nor obtained

Semi-finished

Vertical Integration is Important for Electric

Arc Furnace Steel Producers

6

Company

Raw Materials

Steel Production

Fabrication,

Marketing and

Distribution

CMC

Arizona Micromill

G.A.M. Steel Pty.*

Nucor

Louisiana DRI Facility, David J.

Joseph (scrap)*, Trinidad DRI

Facility

NuMit (JV)*, Magnatrax*, Harris

Steel*

Steel Dynamics

Omnisource (scrap)*, Recycle

South (scrap)*, Mesabi Nugget

The Techs*, CMC Deck and

Joist*, Roanoke Electric*

“CMC’s vertically integrated business model enables the company to

capture profits from every step of the value chain in a normal demand

environment…”

Brian Yu, Citi, October 17, 2011

Note:  Italicized text represents examples of selected investments/acquisitions made since 2006 and is not meant to

be all-inclusive of each company’s operations.  Asterisks used to denote acquisitions. Permission

to use quotations

neither sought nor obtained

We have a Leading North American

Position

Source:  Public filings, company websites, industry sources, and

CMC estimates

North America Recycling (Ferrous Processed)

North America Long Steel

Net tons (millions)

Net tons (millions)

Steel

Dynamics

1.3

CMC

Nucor

4.0

Gerdau

4.4

CMC

4.2

2.1

Schnitzer

Steel

Dynamics

5.8

Sims

8.9

Nucor

5.0

•

We are a leading supplier of rebar

and other products to the

domestic non-residential

construction industry

•

Our mills are some of the lowest

cost producers in North America

•

We have a nationwide presence,

reducing dependence on any

given geographic region

•

We are among the largest ferrous

and nonferrous scrap recyclers in

North America

•

We are a leading fabricator of

rebar product

7

Complemented by Enhanced

International Presence

Source: Public filings, company websites, industry sources, and CMC estimates

1

Revenue from continuing operations for fiscal year ended August 31, 2011

Poland Steel Production (Long Products)

Net tons (millions)

Australian Steel Distribution

Net tons (millions)

Celsa

CMC

Poland

Arcelor

Mittal

CMC

Australia

Bluescope

Onesteel

•

Our international operations, begun

over 80 years ago, represent 45% of

our total revenues¹

•

We are the largest long products

producer

in

Poland,

well-positioned

to capitalize on the country’s

construction boom

–

Poland’s real GDP is forecast to be 200bps+

higher than across the rest of Europe

•

Our International Marketing &

Distribution business provides

valuable insights to physical flows and

demand around the world

–

Consistently profitable segment

8

The CMC Growth Story

Executing Our Plan:

The Board’s Near-Term Priorities

•

Leverage Strategic Investments

–

World-class, low-cost micromill in Arizona

–

Market-leading platform in Poland

•

Optimize Product Mix Across the Portfolio

–

Focusing on highest value-added products

•

Drive substantial cost reductions to improve our competitive position

–

Exit from Croatia mill and unprofitable fabricating locations

“The company is clearly taking more dramatic actions in an otherwise

challenging environment in an effort to increase shareholder value”

Brent Thielman, D.A. Davidson & Co, October 10, 2011

The Board is focused on positioning CMC to fully capture the benefits

of the anticipated recovery

Source:  Company filings and investor presentations

Note:  Permission to use quotations neither sought nor obtained

10

The Board has Put the Right Team on the Field

Joe Alvarado

President & Chief Executive Officer

–

Formerly President of U.S. Tubular Products, a division of U.S. Steel

–

Previously President of Lone Star Technologies

–

Joined CMC as Executive Vice President and Chief Operating Officer in April

2010

–

Appointed Chief Executive Officer of CMC in September 2011

–

Member of Board of Directors of Spectra Energy

Barbara Smith 

Senior Vice President & Chief Financial Officer

–

Third public company CFO role (prior positions at Gerdau Ameristeel and FARO

Technologies, Inc.)

–

24 years of experience with Alcoa

–

Member of the Board of Directors of Minerals Technologies, Inc.

–

Joined CMC as Senior Vice President and Chief Financial Officer in June 2011

“Both CEO and CFO …

were external hires and are strong additions to

CMC’s management team”

Kuni Chen, CRT Capital, June 7, 2011

More than half of CMC's senior team is new to their current role

in the last two years

11

Note: Permission to use quotations neither sought nor obtained

We Have Taken –

and Continue to Take –

Decisive Action

Barbara Smith

becomes CFO

Joe Alvarado

becomes CEO

Joe Alvarado

appointed COO

Commissioned new

mill in Poland

Reduced global

salaried headcount

by 300

Arizona mill hit name

plate capacity

Announced closure

of 5 rebar plants

Announced closure of

Sisak facility in Croatia

IT  headcount

Rationalization

“We view the recent restructuring efforts by the new CEO and CFO

positively.”

Michael Gambardella, JP Morgan, October 31, 2011

Expert technical

delegation to

Croatia

12

Note: Permission to use quotations neither sought nor obtained

Writedown of Deck

& Joist business

~$200mm

These Actions have Already Begun to Yield

Positive Results

Recent Action

Expected

Run-Rate EBITDA Impact

Closed Croatia operation

~$16 million

Closed 5 rebar and 8 CRP locations

~$10 million

Global Operations & IT Headcount Reductions

~$7 million

Total Expected EBITDA Benefit of Actions Taken

~$33 million

“The decision to exit Sisak is positive and consistent with our view that

new management will take aggressive action to streamline the

Company, reduce costs, and exit noncore businesses”

Kuni Chen, CRT Capital, July 7, 2011

13

Note: Expected EBITDA benefit of actions taken by end of fiscal year 2012

Permission to use quotations neither sought nor obtained.

We Continue to Strategically Invest in

Our North American Businesses

•

In 2008/9 we invested $155mm in a state of the art, ultra

low-cost micro mill in Arizona

–

The mill is globally cost competitive and is well positioned to benefit from

recovery in construction in the Southwestern U.S.

•

In 2010/11 we implemented SAP across our U.S. platform

–

Provides

a

foundation

to

improve

efficiency,

reduce

overhead

and

provide

business intelligence

•

Increased low cost recycling capacity provides for internal

consumption and external sales

–

Capital expenditures are expected to be approximately $25mm

•

By investing in world class capacity and core infrastructure

through the downturn, we have enhanced performance in

the current environment and are positioning CMC to capture

the benefits of the anticipated recovery

14

While Actively Developing Our Most

Attractive International Opportunities

•

We are the largest long products steel producer in Poland

–

Minimill capacity 1.9 million tons

–

Main products are rebar, wire rod and merchants

–

Goal is 70% domestic and 30% export sales

–

We continue to evolve the mix in Poland toward higher margin products

•

Acquisition of G.A.M. Steel Pty. in Australia in June 2011

•

Appointed Patrick Seil as President, CMC Asia, in September 2011

–

Former CEO positions at Oriental Steel Pipe and HG Metal Manufacturing

–

Held management positions at TradeARBED, Arcelor, and ArcelorMittal since 1991

15

1

Source:  Public filings, company websites and investor presentations, industry sources, and CMC estimates

1

Management’s Strategy is Bearing Fruit

Ahead of a Cyclical Recovery

16

Note:  See attached reconciliations of non-GAAP measures

$ 5,538

$ 5,361

$ 5,873

$ 6,277

$ 6,659

$ 7,123

$ 7,427

$ 7,863

$ 8,075

$ 157

$ 40

$ 44

$ 78

$ 133

$ 227

$ 280

$ 291

$ 293

Q1 FY10

Q2 FY10

Q3 FY10

Q4 FY10

Q1 FY11

Q2 FY11

Q3 FY11

Q4 FY11

Q1 FY12

LTM Revenue from Continuing Operations

LTM Adjusted EBITDA from Continuing Operations excl. Restructuring Charges

Our Strategy is Delivering Shareholder Value

in Advance of a Cyclical Recovery

17

•

Reported $107.7 million in net income for 1Q12

•

Generated $38 million cash from operations in 1Q12

•

Declared our regular dividend for the 189th straight quarter in

January 2012

•

Substantially completed our plan to wind down operations in

Croatia

•

Completed our plan to adjust our fabricating cost structure with

improved competitive and financial performance in this segment

•

Commissioned two new shredders in December 2011, as a part of

our strategy to grow this profitable segment

•

Largely completed actions to reduce the overhead structure,

which we expect will result in run rate savings of approximately

$33 per year

Our Performance Compares Favorably to That

of Our Competitors

Nucor

4Q FY11

Schnitzer

1Q FY12

Steel

Dynamics

4Q FY11

Note:  Median company guidance for fiscal year end based on range provided in companies’

press releases and only includes

companies that provided EPS guidance.  Median Wall Street Estimates as per IBES are  as of 1 day prior to press release

containing guidance

1

EPS from continuing operations excludes a GAAP tax benefit of $102 million ($0.87 per share) based on a share

count of 116.5 million, related to the Company’s Croatian investment, which the Company announced it is exiting

Most Recent Quarter EPS Excluding One-Time Items

CMC

1Q FY12

18

Wall Street Analysts Recognize Our Superior

Growth Prospects

2011A-2013E Median Wall Street Estimated EBITDA CAGR

19

Note:  Financials calendarized to August 31 year end. Median Wall Street Estimates  from IBES as of December

30, 2011.

11.2%

16.5%

26.3%

34.6%

43.8%

43.8%

Schnitzer

Steel Dynamics

Nucor

U.S. Steel

AK Steel

CMC

Why Our Team

is the Right Team

Our Board is Independent & Highly Qualified

Of our ten continuing directors:

•

5 have been appointed in the last two years

•

9 have financial or operational experience in metals and/or

construction industries

•

9 have CEO or CFO-level experience

•

All

but the CEO are independent

•

All

have experience on other public company boards

•

All

are highly qualified

21

We Have Added 4 Highly Qualified

Independent Directors Since 2010

Richard Kelson

Rick Mills

Sarah Raiss

Joined: January 1, 2012

•

Former Corporate Vice-President

and President of Components

Group of Cummins, Inc.

•

Director of Flowserve Corporation

•

Former Director of Gerdau

Ameristeel and Rohm & Haas

Company

Joined: 2011

•

Former Executive Vice President

Corporate Services, TransCanada  

Corporation

•

Director of Shoppers Drug Mart

Corporation and Business

Development Bank of Canada

•

Former service on the Advisory

Committee on Senior Level

Retention and Compensation for

the Treasury Board of Canada

Rhys Best

22

Joined: 2010

•

Former Chairman of the Board

of Directors, President and CEO

of Lone Star Technologies, Inc.

•

Chairman of Crosstex Energy, L.P.

•

Director of Trinity Industries, Inc.

and Cabot Oil & Gas Corporation

Joined: 2010

•

Chairman, President and CEO

of ServCo, LLC

•

Former EVP and CFO of Alcoa,

Inc.

•

Director of MeadWestvaco

Corporation, PNC Financial  

Services Group, Inc.

Our Nominees Are

The Right Team to Lead CMC

Harold L. Adams 

Director (Independent)

•

Mr. Adams served as the Chairman, President and CEO of an international architecture firm

•

Extensive experience in the construction industry

•

Prior experience on several other public company boards

Joseph Alvarado

Chief Executive Officer

•

Mr. Alvarado has extensive steel industry experience

•

Previously served as President of U.S. Steel Tubular Products, Inc., a division of U.S. Steel, and as

President and COO of its predecessor, Lone Star Technologies

•

Member of the Board of Directors of Spectra Energy

•

Experience on other boards, both public and private

Anthony Massaro

Non-Executive

Chairman of the Board (Independent)

•

Mr. Massaro brings extensive engineering and general industrial experience

•

Extensive senior-level experience at Westinghouse

•

Experience on several  public company boards

•

Previously served as CEO of Lincoln Electric

23

Icahn Has Stated Publicly That He Will Direct His

Deputies to Advance His Self-Interested Agenda

George Hebard

•

Currently a Managing Director at Icahn Capital

•

First

started

working

for

Carl

Icahn

in

1998

Steve Mongillo

•

Until earlier this year, a Director of American Railcar Industries, an Icahn-controlled entity in which

Icahn

serves as Chairman

•

Until earlier this year, a Director of WestPoint International, an Icahn-controlled entity

•

Until earlier this year, a Managing Director at Icahn Capital

•

Affiliated with Carl Icahn

for more than 3 years

James Unger

•

Vice

Chairman,

Director

and

former

CEO

of

American

Railcar

Industries,

in

which

Icahn

serves

as

Chairman

•

Former

Director,

President,

Senior

Vice

President

and

CFO

of

ACF

Industries

(1984-2005),

an

Icahn-

controlled

entity

and

during

the

1980’s

one

of

Icahn’s

principal

vehicles

for

his

investments

in

other

companies

•

Served

as

an

officer

or

director

of

numerous

other

companies

which

were

either

controlled

by

Icahn

or

in which Icahn

had an interest through the ownership of securities

•

Affiliated with Carl Icahn

for more than two decades

24

We Believe That Icahn’s Nominees Cannot

Be Seated Under Federal Law

Under Section 8 of the Clayton Act:

•

Individuals (directly or through their agents) are prohibited from

simultaneously serving on the boards of companies which compete

with each other

•

Icahn owns or controls PSC Metals, which competes with CMC, and

has proposed nominees who are Icahn insiders

•

CMC believes that the proposed nominees’

close relationship with

Icahn raises a serious question as to whether their election would

violate the federal antitrust laws

•

If Icahn’s agenda was not self-interested, we believe he would have

nominated truly independent candidates

We believe that none of these three directors could legally serve

on CMC’s Board

25

Our Slate of Nominees is Superior

CMC Nominees

Icahn Nominees

Adams

Alvarado

Massaro

Unger

Mongillo

Hebard

Public Board

Experience¹

CEO-Level

Experience

Relevant

Industry

Experience

Independent

1 

Excludes companies controlled by Icahn or companies in which Icahn had a significant interest

26

Why We Rejected Icahn’s

Bargain Basement Offer

“An opportunistic bid from Icahn”

Brian Yu, Citi, November 28, 2011

•

$15.00 per share in cash

–

A

significant

discount

of

17.1%

to

CMC’s

52-week

high

of

$18.09

–

No premium

to CMC’s share price of $15.03 as recently as May 19, 2011

–

A

miniscule

premium

of

3.9%

to

CMC’s

one-year

average

price

of

$14.43

•

If successful, Icahn intends to combine CMC with PSC Metals, a

subsidiary of Icahn Enterprises LP

•

Offer conditioned on

–

Removal of shareholder rights plan;

–

Waiver of Delaware 203 condition;

–

At least 40.1% of outstanding shares tendered; and

–

Eleven other conditions

•

Offer will remain open until midnight (EST) January 10, 2012 (unless

extended at the offeror’s option)

28

Note:  Permission to use quotations neither sought nor obtained

Icahn is Trying to Get a Bargain at the Expense

of CMC’s Other Shareholders

“Why would you want to pay full price for something? The whole

idea is to buy a bargain”

Charles Bradford, Bradford Research, December 11, 2011

“I agree with management in thinking that the bid is

opportunistic and is at a weaker part of the cycle.”

Arun Viswanathan, Susquehanna International, December 6, 2011

“Carl Icahn is probably investing in CMC because he believes it is a

cyclical business at a good part of the cycle”

Kenneth Squire, Barron’s, August 13, 2011

“[We] acquired the Shares in the belief that the Shares were

undervalued at current levels [$14.34]”

Schedule 13D filed by the Icahn Group on July 28, 2011

29

Note:  Permission to use quotations neither sought nor obtained

Icahn’s

Proposal came

after a 15% dip

in CMC’s stock,

to create the

illusion of a

meaningful

premium

Icahn’s Offer was Timed to Create the Illusion

of a Meaningful Premium

30

Note:  As of November 25, 2011, the trading day before Icahn’s proposal

$11.45

$7.00

$9.00

$11.00

$13.00

$15.00

$17.00

$19.00

Nov-2009

Mar-2010

Jul-2010

Nov-2010

Mar-2011

Jul-2011

Nov-2011

1 Year Average $14.43

$15.00 Offer Price

3.9%

Premium

5.2 x

7.2 x

6.1 x

5.6 x

4.8 x

4.8 x

CMC @ $15

AK Steel¹

U.S. Steel¹

Nucor

Schnitzer

Steel Dynamics

Icahn’s Offer Is Very Low, Based on the

Implied Multiple of EBITDA

2013E EV/EBITDA

“Once the cycle in this industry rebounds, Commercial Metals

will not only benefit from increased EBITDA, but also might get a

higher valuation multiple on its EBITDA”

Kenneth Squire, Barron’s, August 15, 2011

31

Source:  CapIQ, IBES median estimates and market data as at December 30, 2011

Note:  Permission to use quotations neither sought nor obtained

1

Adjusted to exclude the effects of pension and OPEB liabilities

CMC’s Financial Performance is Closely

Related to Non-Residential Construction

1

Source:  U.S. Census Bureau

2

Source:  McGraw-Hill Construction Research and Analytics, November 28, 2011

3

Source:  Company filings

4

Source:  Wall Street median estimates  from IBES as of December

30, 2011

Note:  All data calendarized to August 31 year end. Refer to Reconciliation.  See attached reconciliations of non-

GAAP measures

32

2%

6%

11%

16%

15%

(2)%

(17)%

(5)%

(1)%

17%

32%

$299

$527

$650

$637

$564

$279

$78

$291

$ 409

$ 543

$ 633

2004

2005

2006

2007

2008

2009

2010

2011

2012E

2013E

2014E

“[T]he most important catalysts we see for the shares outside of company

specific events and earnings are forward looking indicators for construction

activity (most notably ABI) and overall U.S. and global economic

growth”

Luke Folta, Jefferies, July 8, 2011

During Periods of Non-Residential Construction

Growth, CMC has Historically Outperformed

Source:  Bloomberg, Census Bureau

Note:  Peer Index is an average of the share performance of U.S.

steel industry peers (AK Steel, Nucor, Schnitzer,

Steel Dynamics, U.S. Steel).  Permission to use quotations neither sought nor obtained

33

Construction Activity is Expected to Grow Significantly

Now is Precisely the Wrong Time to Sell CMC

Source:  McGraw-Hill Construction Research and Analytics, November 28, 2011

S

34

Conclusion

We believe:

•

CMC is executing on a plan that is already delivering value to shareholders

–

The Board has put in place the right executive management team, with demonstrated

experience

–

CMC is poised to capture further value in an up-cycle in the company’s end markets

–

Recent results demonstrate progress on our plan

•

Icahn’s bid is opportunistic in every way

–

Opportunistically

timed

to

take

advantage

of

a

temporary

decline

in

the

stock

price

of

the Company and its U.S. steel industry peers

–

Opportunistically timed to capture the benefits of management’s strategic plan that

are in the early stages of being realized

•

Icahn’s nominees and proposals are designed to facilitate his acquisition of

control of CMC without paying an appropriate premium

CMC has the Right Team for Shareholders –

Change You Can Count On

Vote for CMC’s WHITE card –

our team is the right team

36

Note:  U.S. steel industry peers include AK Steel, Nucor, Schnitzer, Steel Dynamics and U.S. Steel

Appendix

38

Regulation G Reconciliation -

Annual

Fiscal Year

2004

2005

2006

2007

2008

2009

2010

2011

Net earnings (loss)

$ 132

$ 286

$ 356

$ 355

$ 232

$ 21

$ (205)

$ (130)

Net earnings (loss)

from discontinued operations

(4)

13

2

25

(36)

(21)

(106)

(149)

Net earnings (loss)

from continuing operations

$ 136

$ 273

$ 354

$ 330

$ 268

$ 42

$ (100)

$ 19

Interest Expense

28

30

28

36

56

77

74

70

Income taxes (benefit)

67

150

185

172

115

8

(62)

19

D&A and Impairment

68

74

83

100

124

152

165

178

Consolidated Adjusted EBITDA

from Continuing Operations

$ 299

$ 527

$ 650

$ 637

$ 564

$ 279

$ 78

$ 286

Restructuring Charges from

Continuing Operations:

Severance

-

-

-

-

-

-

-

5

Adjusted EBITDA from

Continuing Operations

excl. restructuring charges

$ 299

$ 527

$ 650

$ 637

$ 564

$ 279

$ 78

$ 291

Revenue from Continuing

Operations

$ 4,376

$ 5,962

$ 6,814

$ 7,881

$ 9,837

$ 6,364

$ 6,277

$ 7,863

Note:  The Company believes the above adjusted EBITDA computations help investors assess the Company’s

operating performance without the impact of depreciation, amortization and restructuring charges. Non-GAAP

numbers should be read in conjunction with GAAP financial measures, as non-GAAP metrics are merely a supplement

to, and not a replacement for, GAAP financial measures.  It should be noted as well that our Adjusted EBITDA metric

may be different from similar metrics provided by other companies. Quarterly numbers may not add to full-year

numbers due to rounding

Regulation G Reconciliation -

Quarterly

39

Note:  The Company believes the above adjusted EBITDA computations help investors assess the Company’s

operating performance without the impact of depreciation, amortization and restructuring charges. Non-GAAP

numbers should be read in conjunction with GAAP financial measures, as non-GAAP metrics are merely a

supplement to, and not a replacement for, GAAP financial measures. It should be noted as well that our Adjusted

EBITDA metric may be different from similar metrics provided by other companies

Fiscal Quarter

Q1

2009

Q2

2009

Q3

2009

Q4

2009

Q1

2010

Q2

2010

Q3

2010

Q4

2010

Q1

2011

Q2

2011

Q3

2011

Q4

2011

Q1

2012

Net earnings (loss)

$ 62

$ (35)

$ (13)

$ 7

$ (31)

$ (173)

$ (9)

$ 8

$ 1

$ (46)

$ 36

$ (120)

$ 108

Net earnings (loss) from

Discontinued Operations

6

(7)

(4)

(17)

(8)

(80)

(10)

(7)

(14)

(12)

(8)

(114)

(17)

Net earnings (loss)  from

Continuing Operations

$ 56

$ (28)

$ (9)

$ 24

$ (23)

$ (93)

$ 1

$ 15

$ 15

$ (34)

$ 45

$ (6)

$ 125

Interest Expense

26

18

19

15

19

20

18

17

18

18

18

16

16

Income taxes (benefit)

25

10

14

(41)

(14)

(50)

4

(2)

7

(13)

15

11

(95)

D&A and Impairment

38

34

35

44

41

40

39

45

39

40

38

61

35

Consolidated Adjusted

EBITDA from Continuing

Operations

$ 145

$ 34

$ 58

$ 42

$ 23

$ (83)

$ 62

$ 75

$ 79

$ 10

$ 115

$ 82

$ 81

Restructuring Charges

from Continuing

Operations:

Severance

-

-

-

-

-

-

-

-

-

-

-

5

-

Adjusted EBITDA from

Continuing Operations

excl. restructuring charges

$ 145

$ 34

$ 58

$ 42

$ 23

$ (83)

$ 62

$ 75

$ 79

$ 10

$ 115

$ 87

$ 81 

Revenue from Continuing

Operations

$ 2,219 $ 1,494 $ 1,247 $ 1,404 $ 1,393 $ 1,317 $ 1,759 $ 1,808 $ 1,775 $ 1,782 $ 2,063 $ 2,244 $ 1,987

Regulation G Reconciliation -

LTM

40

Note: The Company believes the above adjusted EBITDA computations help investors assess the Company’s

operating performance without the impact of depreciation, amortization and restructuring charges.  Non-GAAP

numbers should be read in conjunction with GAAP financial measures, as non-GAAP metrics are merely a

supplement to, and not a replacement for, GAAP financial measures.  It should be noted as well that our Adjusted

EBITDA metric may

be different from similar metrics provided by other companies

LTM as of Fiscal Quarter

Q1 2010

Q2 2010

Q3 2010

Q4 2010

Q1 2011

Q2 2011

Q3 2011

Q4 2011

Q1 2012

Net earnings (loss)

$(72)

$(210)

$(206)

$(205)

$(173)

$(46)

$(1)

$(130)

$(23)

Net earnings (loss) from

Discontinued Operations

(35)

(109)

(115)

(106)

(112)

(43)

(41)

(149)

(152)

Net earnings (loss)  from

Continuing Operations

$(37)

$(102)

$(91)

$(100)

$(62)

$(3)

$40

$19

$129

Interest Expense

71

73

72

74

73

71

71

70

68

Income taxes (benefit)

(31)

(91)

(101)

(62)

(41)

(4)

7

19

(83)

D&A and Impairment

155

160

164

165

164

164

162

178

173

Consolidated Adjusted

EBITDA from Continuing

Operations

$157

$40

$44

$78

$133

$227

$280

$286

$288

Restructuring Charges from

Continuing Operations:

Severance

-

-

-

-

-

-

-

5

5

Adjusted EBITDA from

Continuing Operations

excl. restructuring charges

$157

$40

$44

$78

$133

$227

$280

$291

$293

Revenue from Continuing

Operations

$5,538

$5,361

$5,873

$6,277

$6,659

$7,123

$7,427

$7,863

$8,075

41

Regulation G Reconciliation -

EPS

($ per diluted share)

1Q Fiscal Year 2012

Reported net earnings

$0.93

Net earnings (loss) from discontinued operations

(0.14)

Net earnings from continuing operations

$1.07

Tax benefit¹

0.87

Net earnings from continuing operations excluding tax benefit

$0.20

Note: The Company believes the above net earnings per share from

continuing operations excluding tax benefit

computation helps investors assess the Company’s operating performance without the impact of net tax benefits.

Non-GAAP numbers should be read in conjunction with GAAP financial measures, as non-GAAP metrics are merely a

supplement to, and not a replacement for, GAAP financial measures.  It should be noted that our net earnings per

share from continuing operations excluding tax benefit computation metric may be calculated differently from

similar metrics provided by other companies

1

Tax benefit related to ordinary worthless stock and bad debt deduction from the company’s investment in the

Croatian subsidiary

CORPORATE OFFICE

6565 N. MacArthur Blvd

Suite 800

Irving, TX  75039

Phone:  (214) 689.4300

INVESTOR RELATIONS

Phone:  (972) 308.5349

Fax:  (214) 689.4326

IR@cmc.com

MACKENZIE PARTNERS, INC.

105 Madison Ave

New York, NY 10016

Phone:  (212) 929-5500

proxy@mackenziepartners.com

tenderoffer@mackenziepartners.com

SARD VERBINNEN & CO.

630 Third Ave

Level 9

New York, NY 10017

Phone:  (212) 687-8080