Reliance Steel & Aluminum (RS) 10-Q 2 Aug 18 2018 Q2 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	6 Months Ended
	Jun. 30, 2018	Jul. 27, 2018
Document and Entity Information
Entity Registrant Name	RELIANCE STEEL & ALUMINUM CO
Entity Central Index Key	861,884
Document Type	10-Q
Document Period End Date	Jun. 30, 2018
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity Current Reporting Status	Yes
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding		72,350,258
Document Fiscal Year Focus	2,018
Document Fiscal Period Focus	Q2

CONSOLIDATED BALANCE SHEETS

CONSOLIDATED BALANCE SHEETS - USD ($) $ in Millions	Jun. 30, 2018	Dec. 31, 2017
Current assets:
Cash and cash equivalents	$ 124.3	$ 154.4
Accounts receivable, less allowance for doubtful accounts of $21.2 at June 30, 2018 and $15.5 at December 31, 2017	1,379.2	1,087.3
Inventories	2,062.1	1,726
Prepaid expenses and other current assets	82.6	80.7
Income taxes receivable		2.9
Total current assets	3,648.2	3,051.3
Property, plant and equipment:
Land	230.5	229.7
Buildings	1,122.6	1,095.3
Machinery and equipment	1,797.4	1,738.6
Accumulated depreciation	(1,484.1)	(1,407.3)
Property, plant and equipment, net	1,666.4	1,656.3
Goodwill	1,848.7	1,842.6
Intangible assets, net	1,101.5	1,112.1
Cash surrender value of life insurance policies, net	41	47.8
Other assets	46.8	40.9
Total assets	8,352.6	7,751
Current liabilities:
Accounts payable	517.8	346.7
Accrued expenses	83	83.6
Accrued compensation and retirement costs	141.8	139.3
Accrued insurance costs	43.9	42.1
Current maturities of long-term debt and short-term borrowings	104.4	92
Income taxes payable	8.5
Total current liabilities	899.4	703.7
Long-term debt	1,932.7	1,809.4
Long-term retirement costs	88	85.4
Other long-term liabilities	14.2	11.8
Deferred income taxes	437.5	440.8
Commitments and contingencies
Equity:
Preferred stock, $0.001 par value: Authorized shares — 5,000,000 None issued or outstanding
Common stock and additional paid-in capital, $0.001 par value: Authorized shares — 200,000,000 Issued and outstanding shares – 72,350,258 at June 30, 2018 and 72,609,540 at December 31, 2017	561.3	594.6
Retained earnings	4,470.6	4,144.1
Accumulated other comprehensive loss	(85.7)	(71.6)
Total Reliance stockholders' equity	4,946.2	4,667.1
Noncontrolling interests	34.6	32.8
Total equity	4,980.8	4,699.9
Total liabilities and equity	$ 8,352.6	$ 7,751

CONSOLIDATED BALANCE SHEETS (Pa

CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Millions	Jun. 30, 2018	Dec. 31, 2017
CONSOLIDATED BALANCE SHEETS
Accounts receivable, allowance for doubtful accounts	$ 21.2	$ 15.5
Preferred stock, par value (in dollars per share)	$ 0.001	$ 0.001
Preferred stock, Authorized shares	5,000,000	5,000,000
Preferred stock, issued shares	0	0
Preferred stock, outstanding shares	0	0
Common stock, par value (in dollars per share)	$ 0.001	$ 0.001
Common stock, Authorized shares	200,000,000	200,000,000
Common stock, Issued shares	72,350,258	72,609,540
Common stock, outstanding shares	72,350,258	72,609,540

CONSOLIDATED STATEMENTS OF INCO

CONSOLIDATED STATEMENTS OF INCOME - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
CONSOLIDATED STATEMENTS OF INCOME
Net sales	$ 2,988.9	$ 2,475.2	$ 5,746	$ 4,894.5
Costs and expenses:
Cost of sales (exclusive of depreciation and amortization shown below)	2,071.4	1,773.1	4,008.6	3,470.8
Warehouse, delivery, selling, general and administrative	535.9	475.9	1,055.3	952.1
Depreciation and amortization	54.3	55	108.4	110.2
Total costs and expenses	2,661.6	2,304	5,172.3	4,533.1
Operating income	327.3	171.2	573.7	361.4
Other (income) expense:
Interest expense	21.3	18.5	40.6	35.8
Other (income) expense, net	(0.6)	0.3	1.3	4.7
Income before income taxes	306.6	152.4	531.8	320.9
Income tax provision	73.5	47.6	127.6	102.7
Net income	233.1	104.8	404.2	218.2
Less: Net income attributable to noncontrolling interests	2.3	1.8	4.4	3.5
Net income attributable to Reliance	$ 230.8	$ 103	$ 399.8	$ 214.7
Earnings per share attributable to Reliance stockholders:
Diluted earnings per common share (in dollars per share)	$ 3.16	$ 1.40	$ 5.46	$ 2.92
Basic earnings per common share (in dollars per share)	3.19	1.41	5.51	2.95
Cash dividends per share (in dollars per share)	$ 0.50	$ 0.45	$ 1	$ 0.90

CONSOLIDATED STATEMENTS OF COMP

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
Net income	$ 233.1	$ 104.8	$ 404.2	$ 218.2
Other comprehensive (loss) income
Foreign currency translation (loss) gain	(11.2)	6.4	(14.1)	14
Pension and postretirement benefit adjustments, net of tax				2.3
Total other comprehensive (loss) income	(11.2)	6.4	(14.1)	16.3
Comprehensive income	221.9	111.2	390.1	234.5
Less: Comprehensive income attributable to noncontrolling interests	2.3	1.8	4.4	3.5
Comprehensive income attributable to Reliance	$ 219.6	$ 109.4	$ 385.7	$ 231

CONSOLIDATED STATEMENTS OF CASH

CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Millions	6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017
Operating activities:
Net income	$ 404.2	$ 218.2
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization expense	108.4	110.2
Provision for uncollectible accounts	7.1	4.1
Deferred income tax benefit	(2.8)	(2.1)
Gain on sales of property, plant and equipment	(0.1)	(3.9)
Stock-based compensation expense	19.3	14.9
Other	4.1	5.6
Changes in operating assets and liabilities (excluding effect of businesses acquired):
Accounts receivable	(295)	(219.5)
Inventories	(332)	(216.5)
Prepaid expenses and other assets	(1.5)	1.4
Accounts payable and other liabilities	185.3	102.8
Net cash provided by operating activities	97	15.2
Investing activities:
Purchases of property, plant and equipment	(98.6)	(72.8)
Acquisitions, net of cash acquired	(39.6)	(1.3)
Other	9.2	7.2
Net cash used in investing activities	(129)	(66.9)
Financing activities:
Net short-term debt (repayments) borrowings	(2.1)	3.3
Proceeds from long-term debt borrowings	670	541
Principal payments on long-term debt	(533.3)	(406.7)
Dividends and dividend equivalents paid	(74.6)	(66.5)
Exercise of stock options	2.8	2.8
Share repurchases	(50)
Other	(8)	(3.3)
Net cash provided by financing activities	4.8	70.6
Effect of exchange rate changes on cash and cash equivalents	(2.9)	4.8
(Decrease) increase in cash and cash equivalents	(30.1)	23.7
Cash and cash equivalents at beginning of year	154.4	122.8
Cash and cash equivalents at end of period	124.3	146.5
Supplemental cash flow information:
Interest paid during the period	39.7	36.1
Income taxes paid during the period, net	$ 114.5	$ 107.1

Basis of Presentation

Basis of Presentation	6 Months Ended
	Jun. 30, 2018
Basis of Presentation
Basis of Presentation	1. Basis of Presentation Principles of Consolidation The accompanying unaudited consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”) for interim financial information and with the instructions of Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of management, all adjustments, consisting only of normal recurring adjustments necessary for a fair presentation with respect to the interim financial statements, have been included. The results of operations for the six months ended June 30, 2018 are not necessarily indicative of the results for the full year ending December 31, 2018. These financial statements should be read in conjunction with the consolidated financial statements and footnotes thereto for the year ended December 31, 2017, included in Reliance Steel & Aluminum Co.’s (“Reliance”, the “Company”, “we”, “our” or “us”) Annual Report on Form 10-K. The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts and the disclosure of contingent amounts in our consolidated financial statements and the accompanying notes. Actual results could differ from those estimates. Our consolidated financial statements include the assets, liabilities and operating results of majority-owned subsidiaries. All significant intercompany accounts and transactions have been eliminated. The ownership of the other interest holders of consolidated subsidiaries is reflected as noncontrolling interests. Our investments in unconsolidated subsidiaries are recorded under the equity method of accounting.

Impact of Recently Issued Accou

Impact of Recently Issued Accounting Guidance	6 Months Ended
	Jun. 30, 2018
Impact of Recently Issued Accounting Guidance
Impact of Recently Issued Accounting Guidance	2. Impact of Recently Issued Accounting Guidance Impact of Recently Issued Accounting Standards—Adopted Revenue from Contracts with Customers —In May 2014, the Financial Accounting Standards Board (“FASB”) issued accounting changes that replaced most of the detailed guidance on revenue recognition that previously existed under U.S. GAAP. Under the new standard, an entity should recognize revenue when goods or services are transferred to the customer in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The standard also requires enhanced disclosures regarding the nature, amount, timing and uncertainty of revenue and cash flows arising from an entity’s contracts with customers. We adopted these changes as of January 1, 2018 using the modified retrospective method. See Note 4—“Revenues” for further details. Classification of Certain Cash Receipts and Cash Payments —In August 2016, the FASB issued accounting changes that clarify the presentation and classification of certain cash receipts and payments in the statement of cash flows with the objective of reducing the existing diversity in practice with respect to eight types of cash flows. We adopted these changes as of January 1, 2018. The adoption of this standard did not have a material impact on our consolidated financial statements. Impact of Recently Issued Accounting Standards—Not Yet Adopted Leases — In February 2016, the FASB issued accounting changes which will require lessees to recognize most long-term leases on the balance sheet through the recognition of a right-of-use asset and a lease liability. The guidance will be effective for fiscal years and interim periods beginning after December 15, 2018, or January 1, 2019 for the Company. Early adoption is permitted. We have implemented a lease management system and are developing processes necessary to implement these accounting changes. We anticipate adopting this new standard on January 1, 2019 with modified retrospective application, using the available practical expedients. We expect the adoption of these accounting changes will materially increase our assets and liabilities, but will not have a material impact on our net income, equity, or cash flows. We are unable to quantify the ultimate impact of adopting this new standard at this time as the actual impact will depend on the total amount of our lease commitments as of the adoption date. Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income — In February 2018, the FASB issued accounting changes that allow a reclassification from accumulated other comprehensive income to retained earnings for stranded tax effects resulting from the Tax Cuts and Jobs Act of 2017 (“Tax Reform”) . The guidance is effective for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years. Early adoption is permitted in any interim period. The adoption of this standard will not have a material impact on our consolidated financial statements.

Acquisitions

Acquisitions	6 Months Ended
	Jun. 30, 2018
Acquisitions
Acquisitions	3. Acquisitions On March 1, 2018, we acquired DuBose National Energy Services, Inc. (“DuBose Energy”) and its affiliate, DuBose National Energy Fasteners & Machined Parts, Inc. (“DuBose Fasteners” and, together with DuBose Energy, “DuBose”). DuBose was founded in 1990 and is headquartered in Clinton, North Carolina. DuBose specializes in fabrication, supply and distribution of metal and metal products to the nuclear industry, including utilities, component manufacturers and contractors. DuBose’s net sales during the period from March 1, 2018 to June 30, 2018 were $9.1 million. On October 2, 2017, through our wholly owned subsidiary Diamond Manufacturing Company, we acquired Ferguson Perforating Company (“Ferguson”). Ferguson, headquartered in Providence, Rhode Island, specializes in manufacturing highly engineered and complex perforated metal parts for diverse end markets including industrial machinery, automotive, aerospace, sugar products and consumer electronics manufacturers. Ferguson’s net sales were $19.4 million for the six months ended June 30, 2018. We funded our acquisitions of DuBose and Ferguson with borrowings on our revolving credit facility and cash on hand. The acquisitions discussed in this note have been accounted for under the acquisition method of accounting and, accordingly, the respective purchase price has been allocated to the assets acquired and liabilities assumed based on their estimated fair values at the date of each acquisition. The accompanying consolidated statements of income include the revenues and expenses of each acquisition since its respective acquisition date. The consolidated balance sheets reflect the allocation of each acquisition’s purchase price as of June 30, 2018 and December 31, 2017, as applicable. The purchase price allocation for our acquisition of DuBose is preliminary and is pending the completion of pre-acquisition period income tax returns. The measurement periods for purchase price allocations do not exceed 12 months from the acquisition date.

Revenues

Revenues	6 Months Ended
	Jun. 30, 2018
Revenue
Revenues	4. Revenues Revenue from Contracts with Customers On January 1, 2018, we adopted new accounting guidance relating to the recognition of revenue from contracts with our customers using the modified retrospective method applied to those contracts which were not completed as of January 1, 2018. We did not record a cumulative-effect adjustment to retained earnings upon adoption and comparable period financial statement amounts have not been adjusted. Our reported results for the six months ended June 30, 2018 would not have been different if reported under the previous accounting standard. Revenue Recognition We recognize revenue when control of metal products or services is transferred to our customers, in an amount that reflects the consideration we expect to be entitled to in exchange for those goods or services. There are no significant judgments or estimates made to determine the amount or timing of our reported revenues. The amount of transaction price associated with unperformed performance obligations and the amount of our contract balances is not significant. The following table presents our sales disaggregated by product and service. Certain sales taxes or value-added taxes collected from customers are excluded from our reported sales. Three Months Ended Six Months Ended June 30, June 30, 2018 2017 2018 2017 (in millions) Carbon Steel $ 1,642.2 $ 1,331.8 $ 3,103.4 $ 2,617.3 Aluminum 570.0 487.8 1,120.2 970.9 Stainless Steel 428.7 348.0 831.9 695.3 Alloy 172.5 145.8 341.5 291.1 Toll processing and logistics 104.3 85.8 205.4 173.0 Other and eliminations 71.2 76.0 143.6 146.9 Total $ 2,988.9 $ 2,475.2 $ 5,746.0 $ 4,894.5 Metal Sales Metal product sales represented approximately 94% of our revenues for the six months ended June 30, 2018. We have minimal contract sales with our customers as we primarily sell our inventories in the “spot market” under fixed price sales orders. The contracts with our customers generally have only one performance obligation. Control of the metal products we sell transfers to our customers upon delivery for orders with FOB destination terms or upon shipment for orders with FOB shipping point terms. Shipping and handling charges to our customers are included in net sales. We account for all shipping and handling of our products as fulfillment activities and not as a promised good or service. Costs incurred in connection with the shipping and handling of our products are typically included in operating expenses whether we use a third-party carrier or our own trucks. Shipment and delivery of our orders generally occur on the same day due to the close proximity of our customers and our metals service center locations. Toll Processing and Logistics Toll processing services relate to the processing of customer-owned metal. Logistics services primarily include transportation services for metal we toll-process. Revenue for these services is recognized over time as the toll processing or logistics services are performed. These services are generally short-term in nature with the service being performed in less than one day. Seasonality Some of our customers are in seasonal businesses, especially customers in the construction industry and related businesses. However, our overall operations have not shown any material seasonal trends as a result of our geographic, product and customer diversity. Typically, revenues in the months of July, November and December have been lower than in other months because of a reduced number of working days for shipments of our products, resulting from holidays observed by the Company as well as vacation and extended holiday closures at some of our customers.

Goodwill

Goodwill	6 Months Ended
	Jun. 30, 2018
Goodwill.
Goodwill	5. Goodwill The change in the carrying amount of goodwill is as follows: (in millions) Balance at January 1, 2018 $ 1,842.6 Acquisition 9.1 Effect of foreign currency translation (3.0) Balance at June 30, 2018 $ 1,848.7 We had no accumulated impairment losses related to goodwill at June 30, 2018. The goodwill recorded from our acquisition of DuBose is tax deductible.

Intangible Assets, net

Intangible Assets, net	6 Months Ended
	Jun. 30, 2018
Intangible Assets, net
Intangible Assets, net	6. Intangible Assets, net Intangible assets, net consisted of the following: June 30, 2018 December 31, 2017 Weighted Average Gross Gross Amortizable Carrying Accumulated Carrying Accumulated Life in Years Amount Amortization Amount Amortization (in millions) Intangible assets subject to amortization: Covenants not to compete 4.8 $ 0.8 $ (0.5) $ 0.8 $ (0.4) Customer lists/relationships 14.5 751.1 (413.3) 745.0 (391.3) Software 10.0 8.1 (8.1) 8.1 (8.1) Other 4.7 5.9 (5.7) 6.3 (5.9) 765.9 (427.6) 760.2 (405.7) Intangible assets not subject to amortization: Trade names 763.2 — 757.6 — $ 1,529.1 $ (427.6) $ 1,517.8 $ (405.7) Intangible assets recorded in connection with our acquisition of DuBose were $15.7 million as of June 30, 2018 (see Note 3—“Acquisitions” ). A total of $6.6 million was allocated to the trade names acquired, which is not subject to amortization. We recognized amortization expense for intangible assets of $23.7 million and $26.7 million for the six months ended June 30, 2018 and 2017, respectively. Foreign currency translation losses related to intangible assets, net, were $2.3 million during the six months ended June 30, 2018. The following is a summary of estimated aggregate amortization expense for the remaining six months of 2018 and each of the succeeding five years: (in millions) 2018 (remaining six months) $ 23.7 2019 47.3 2020 47.3 2021 43.2 2022 35.1 2023 29.1

Debt

Debt	6 Months Ended
	Jun. 30, 2018
Debt
Debt	7. Debt Debt consisted of the following: June 30, December 31, 2018 2017 (in millions) Unsecured revolving credit facility due September 30, 2021 $ 690.0 $ 538.0 Unsecured term loan due from September 28, 2018 to September 30, 2021 547.5 562.5 Senior unsecured notes due April 15, 2023 500.0 500.0 Senior unsecured notes due November 15, 2036 250.0 250.0 Other notes and revolving credit facilities 61.4 64.0 Total 2,048.9 1,914.5 Less: unamortized discount and debt issuance costs (11.8) (13.1) Less: amounts due within one year and short-term borrowings (104.4) (92.0) Total long-term debt $ 1,932.7 $ 1,809.4 Unsecured Credit Facility On September 30, 2016, we entered into a $2.1 billion unsecured five-year credit agreement (“Credit Agreement”) comprised of a $1.5 billion unsecured revolving credit facility and a $600.0 million unsecured term loan, with an option to increase the revolving credit facility up to an additional $500.0 million at our request, subject to approval of the lenders and certain other customary conditions. Weighted average interest rates on borrowings outstanding on the revolving credit facility were 3.40% and 2.96% as of June 30, 2018 and December 31, 2017, respectively. Weighted average interest rates on borrowings outstanding on the term loan were 3.34% and 2.82% as of June 30, 2018 and December 31, 2017, respectively. Senior Unsecured Notes On November 20, 2006, we entered into an indenture (the “2006 Indenture”), for the issuance of $600.0 million of unsecured debt securities. The total debt issued was comprised of two tranches, (a) $350.0 million aggregate principal amount of senior unsecured notes bearing interest at the rate of 6.20% per annum, which matured and were repaid on November 15, 2016 and (b) $250.0 million aggregate principal amount of senior unsecured notes bearing interest at the rate of 6.85% per annum, maturing on November 15, 2036. On April 12, 2013, we entered into an indenture (the “2013 Indenture” and, together with the 2006 Indenture, the “Indentures”), for the issuance of $500.0 million aggregate principal amount of senior unsecured notes at the rate of 4.50% per annum, maturing on April 15, 2023. Under the Indentures, the notes are senior unsecured obligations and rank equally in right of payment with all of our existing and future unsecured and unsubordinated obligations. If we experience a change in control accompanied by a downgrade in our credit rating, we will be required to repurchase the notes at a price equal to 101% of their principal amount plus accrued and unpaid interest. Other Notes and Revolving Credit Facilities Revolving credit facilities with a combined credit limit of approximately $63.0 million are in place for operations in Asia and Europe with combined outstanding balances of $51.3 million and $53.9 million as of June 30, 2018 and December 31, 2017, respectively. Various industrial revenue bonds had combined outstanding balances of $10.1 million as of June 30, 2018 and December 31, 2017, and have maturities through 2027. Covenants The Credit Agreement and the Indentures include customary representations, warranties, covenants, acceleration, indemnity and events of default provisions. The covenants under the Credit Agreement include, among other things, two financial maintenance covenants that require us to comply with a minimum interest coverage ratio and a maximum leverage ratio.

Income Taxes

Income Taxes	6 Months Ended
	Jun. 30, 2018
Income Taxes
Income Taxes	8. Income Taxes Our effective income tax rates for the three-month periods ended June 30, 2018 and 2017 were 24.0% and 31.2%, respectively. Our effective income tax rates for the six-month periods ended June 30, 2018 and 2017 were 24.0% and 32.0%, respectively. Our 2018 three-month and six-month period effective income tax rates were favorably impacted by the Tax Cuts and Jobs Act of 2017 (“Tax Reform”), which included significant changes to the taxation of U.S. corporations, including a reduction of the U.S. federal statutory rate from 35% to 21%, effective January 1, 2018. Based on our preliminary assessment of the impact of Tax Reform, we recognized a one-time, provisional net tax benefit of $207.3 million in the fourth quarter of 2017, primarily related to the remeasurement of deferred tax assets and liabilities at the lowered federal statutory tax rate, which was partially offset by repatriation and related liabilities . Given the substantial changes to the Internal Revenue Code as a result of Tax Reform, our estimated financial impacts from Tax Reform are subject to further analysis, interpretation and clarification of the new law, which could result in changes to our estimates in future quarters in 2018. We did not make an adjustment during the six months ended June 30, 2018 to our provisional estimate recognized in 2017. State income taxes offset by the effects of company-owned life insurance policies mainly accounted for the difference between our effective income tax rate and the federal statutory rate for the six months ended June 30, 2018 .

Equity

Equity	6 Months Ended
	Jun. 30, 2018
Equity
Equity	9. Equity Common Stock and Share Repurchase Plan On October 20, 2015, our Board of Directors increased the number of shares authorized to be repurchased under our share repurchase plan by 7.5 million shares and extended the duration of the plan through December 31, 2018. We repurchase shares through open market purchases under plans complying with Rule 10b5-1 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”). During the six months ended June 30, 2018, we repurchased 592,564 shares of our common stock at an average cost of $84.38 per share for a total of $50.0 million. Since initiating the share repurchase plan in 1994, we have repurchased approximately 23.1 million shares at an average cost of $32.94 per share. As of June 30, 2018, we had authorization under the plan to purchase approximately 7.5 million shares, or about 10% of our current outstanding shares. Repurchased and subsequently retired shares are restored to the status of authorized but unissued shares. Common stock and additional paid-in capital activity included the following: Three Months Ended Six Months Ended June 30, 2018 June 30, 2018 Weighted Average Weighted Average Shares Amount Exercise Price Shares Amount Exercise Price (in millions, except share and per share amounts) Stock-based compensation (1) 15,574 $ 12.9 $ 13.9 Stock options exercised — — 2.8 $ Share repurchases — — (592,564) (50.0) Total 15,574 $ 12.9 (259,282) $ (33.3) (1) The six months ended June 30, 2018 amount is comprised of stock-based compensation expense of $ 19.3 million reduced by $5.4 million of payments we made to tax authorities on our employees’ behalf for shares withheld related to net share settlements. Dividends On July 25, 2018, our Board of Directors declared the 2018 third quarter cash dividend of $0.50 per share. The dividend is payable on September 7, 2018 to stockholders of record as of August 17, 2018. During the second quarters of 2018 and 2017, we declared and paid quarterly dividends of $0.50 and $0.45 per share, or $36.1 million and $32.8 million in total, respectively. During the six months ended June 30, 2018 and 2017, we declared and paid quarterly dividends of $1.00 and $0.90 per share, or $72.6 million and $65.6 million in total, respectively. During the six months ended June 30, 2018 and 2017, we paid $2.0 million and $0.9 million in dividend equivalents with respect to vested restricted stock units (“RSUs”), respectively. Stock-Based Compensation We make annual grants of long-term incentive awards to officers and key employees in the forms of service-based and performance-based RSUs that generally have approximately 3-year vesting periods. The performance-based RSU awards are subject to both service and performance goal criteria. We also make annual grants of stock to the non-employee members of the Board of Directors that include dividend rights and vest immediately upon grant. The fair value of the RSUs and stock grants is determined based on the closing stock price of our common stock on the grant date. A summary of the status of our unvested service-based and performance-based RSUs as of June 30, 2018 and changes during the six-month period then ended is as follows: Weighted Average Grant Unvested Shares Shares Date Fair Value Unvested at January 1, 2018 924,575 $ Granted (1) 474,715 Vested (3,362) Cancelled or forfeited (13,318) Unvested at June 30, 2018 $ Shares reserved for future grants (all plans) (1) 474,715 RSUs, including 178,970 performance-based RSUs, were granted in March 2018. Accumulated Other Comprehensive Loss Accumulated other comprehensive loss included the following: Pension and Accumulated Foreign Currency Postretirement Other Translation Benefit Adjustments, Comprehensive Loss Net of Tax Loss (in millions) Balance as of January 1, 2018 $ (51.1) $ (20.5) $ (71.6) Current-period change (14.1) — (14.1) Balance as of June 30, 2018 $ (65.2) $ (20.5) $ (85.7) Foreign currency translation adjustments have not been adjusted for income taxes. Pension and postretirement benefit adjustments are net of taxes of $13.6 million as of June 30, 2018 and December 31, 2017.

Commitments and Contingencies

Commitments and Contingencies	6 Months Ended
	Jun. 30, 2018
Commitments and Contingencies.
Commitments and Contingencies	10. Commitments and Contingencies Environmental Contingencies We are currently involved with an environmental remediation project related to activities at former manufacturing operations of Earle M. Jorgensen Company (“EMJ”), our wholly owned subsidiary, which operations were sold many years prior to our acquisition of EMJ in 2006. Although the potential cleanup costs could be significant, EMJ maintained insurance policies during the time it owned the manufacturing operations that have covered costs incurred to date, and are expected to continue to cover the majority of the related costs. We do not expect that this obligation will have a material adverse impact on our consolidated financial position, results of operations or cash flows. Legal Matters From time to time, we are named as a defendant in legal actions. Generally, these actions arise in the ordinary course of business. We are not currently a party to any pending legal proceedings other than routine litigation incidental to the business. We expect that these matters will be resolved without having a material adverse effect on our results of operations, financial condition or cash flows. We maintain general liability insurance against risks arising out of our normal course of business.

Earnings Per Share

Earnings Per Share	6 Months Ended
	Jun. 30, 2018
Earnings Per Share
Earnings Per Share	11. Earnings Per Share The following table sets forth the computation of basic and diluted earnings per share: Three Months Ended Six Months Ended June 30, June 30, 2018 2017 2018 2017 (in millions, except share and per share amounts) Numerator: Net income attributable to Reliance $ $ $ $ Denominator: Weighted average shares outstanding Dilutive effect of stock-based awards Weighted average diluted shares outstanding Earnings per share attributable to Reliance stockholders: Diluted $ $ $ $ Basic $ $ $ $ Potentially dilutive securities whose effect would have been antidilutive were not significant for the three-month and six-month periods ended June 30, 2018 and 2017.

Subsequent Events

Subsequent Events	6 Months Ended
	Jun. 30, 2018
Subsequent Events
Subsequent Events	12. Subsequent Events On August 1, 2018, we acquired KMS Fab, LLC and KMS South, Inc. (collectively, “KMS” or “the KMS Companies”). The KMS Companies specialize in precision sheet metal fabrication ranging from prototypes to large production runs which utilize a wide variety of metals and fabrication methods including: laser cutting, stamping, turret punching, machining, powder coating and welding. For the fiscal year ended December 31, 2017, the KMS Companies’ combined net sales were $23.3 million.

Revenues (Tables)

Revenues (Tables)	6 Months Ended
	Jun. 30, 2018
Revenue
Schedule of disaggregation of revenue	The following table presents our sales disaggregated by product and service. Certain sales taxes or value-added taxes collected from customers are excluded from our reported sales. Three Months Ended Six Months Ended June 30, June 30, 2018 2017 2018 2017 (in millions) Carbon Steel $ 1,642.2 $ 1,331.8 $ 3,103.4 $ 2,617.3 Aluminum 570.0 487.8 1,120.2 970.9 Stainless Steel 428.7 348.0 831.9 695.3 Alloy 172.5 145.8 341.5 291.1 Toll processing and logistics 104.3 85.8 205.4 173.0 Other and eliminations 71.2 76.0 143.6 146.9 Total $ 2,988.9 $ 2,475.2 $ 5,746.0 $ 4,894.5

Goodwill (Tables)

Goodwill (Tables)	6 Months Ended
	Jun. 30, 2018
Goodwill.
Schedule of changes in the carrying amount of goodwill	(in millions) Balance at January 1, 2018 $ 1,842.6 Acquisition 9.1 Effect of foreign currency translation (3.0) Balance at June 30, 2018 $ 1,848.7

Intangible Assets, net (Tables)

Intangible Assets, net (Tables)	6 Months Ended
	Jun. 30, 2018
Intangible Assets, net
Summary of intangible assets, net	June 30, 2018 December 31, 2017 Weighted Average Gross Gross Amortizable Carrying Accumulated Carrying Accumulated Life in Years Amount Amortization Amount Amortization (in millions) Intangible assets subject to amortization: Covenants not to compete 4.8 $ 0.8 $ (0.5) $ 0.8 $ (0.4) Customer lists/relationships 14.5 751.1 (413.3) 745.0 (391.3) Software 10.0 8.1 (8.1) 8.1 (8.1) Other 4.7 5.9 (5.7) 6.3 (5.9) 765.9 (427.6) 760.2 (405.7) Intangible assets not subject to amortization: Trade names 763.2 — 757.6 — $ 1,529.1 $ (427.6) $ 1,517.8 $ (405.7)
Summary of estimated aggregate amortization expense	The following is a summary of estimated aggregate amortization expense for the remaining six months of 2018 and each of the succeeding five years: (in millions) 2018 (remaining six months) $ 23.7 2019 47.3 2020 47.3 2021 43.2 2022 35.1 2023 29.1

Debt (Tables)

Debt (Tables)	6 Months Ended
	Jun. 30, 2018
Debt
Summary of debt	June 30, December 31, 2018 2017 (in millions) Unsecured revolving credit facility due September 30, 2021 $ 690.0 $ 538.0 Unsecured term loan due from September 28, 2018 to September 30, 2021 547.5 562.5 Senior unsecured notes due April 15, 2023 500.0 500.0 Senior unsecured notes due November 15, 2036 250.0 250.0 Other notes and revolving credit facilities 61.4 64.0 Total 2,048.9 1,914.5 Less: unamortized discount and debt issuance costs (11.8) (13.1) Less: amounts due within one year and short-term borrowings (104.4) (92.0) Total long-term debt $ 1,932.7 $ 1,809.4

Equity (Tables)

Equity (Tables)	6 Months Ended
	Jun. 30, 2018
Equity
Schedule of common stock and additional paid-in capital activity	Three Months Ended Six Months Ended June 30, 2018 June 30, 2018 Weighted Average Weighted Average Shares Amount Exercise Price Shares Amount Exercise Price (in millions, except share and per share amounts) Stock-based compensation (1) 15,574 $ 12.9 $ 13.9 Stock options exercised — — 2.8 $ Share repurchases — — (592,564) (50.0) Total 15,574 $ 12.9 (259,282) $ (33.3) (1) The six months ended June 30, 2018 amount is comprised of stock-based compensation expense of $ 19.3 million reduced by $5.4 million of payments we made to tax authorities on our employees’ behalf for shares withheld related to net share settlements.
Summary of the status of the Company's unvested restricted stock units and changes during the year	Weighted Average Grant Unvested Shares Shares Date Fair Value Unvested at January 1, 2018 924,575 $ Granted (1) 474,715 Vested (3,362) Cancelled or forfeited (13,318) Unvested at June 30, 2018 $ Shares reserved for future grants (all plans) (1) 474,715 RSUs, including 178,970 performance-based RSUs, were granted in March 2018.
Schedule of accumulated other comprehensive loss	Pension and Accumulated Foreign Currency Postretirement Other Translation Benefit Adjustments, Comprehensive Loss Net of Tax Loss (in millions) Balance as of January 1, 2018 $ (51.1) $ (20.5) $ (71.6) Current-period change (14.1) — (14.1) Balance as of June 30, 2018 $ (65.2) $ (20.5) $ (85.7)

Earnings Per Share (Tables)

Earnings Per Share (Tables)	6 Months Ended
	Jun. 30, 2018
Earnings Per Share
Computation of basic and diluted earnings per share	Three Months Ended Six Months Ended June 30, June 30, 2018 2017 2018 2017 (in millions, except share and per share amounts) Numerator: Net income attributable to Reliance $ $ $ $ Denominator: Weighted average shares outstanding Dilutive effect of stock-based awards Weighted average diluted shares outstanding Earnings per share attributable to Reliance stockholders: Diluted $ $ $ $ Basic $ $ $ $

Acquisitions (Details)

Acquisitions (Details) - USD ($) $ in Millions	3 Months Ended		4 Months Ended	6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2018	Jun. 30, 2017
Acquisitions
Net sales	$ 2,988.9	$ 2,475.2		$ 5,746	$ 4,894.5
DuBose
Acquisitions
Net sales			$ 9.1
Ferguson
Acquisitions
Net sales				$ 19.4

Revenues (Details)

Revenues (Details) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2018USD ($)	Jun. 30, 2017USD ($)	Jun. 30, 2018USD ($)item	Jun. 30, 2017USD ($)
Revenue Disaggregation
Revenue	$ 2,988.9		$ 5,746
Revenue from sales of metal products (as a percent)			94.00%
Number of performance obligations from sales of metal products | item			1
Before adoption of ASU 2014-09
Revenue Disaggregation
Revenue		$ 2,475.2		$ 4,894.5
Carbon steel
Revenue Disaggregation
Revenue	1,642.2		$ 3,103.4
Carbon steel | Before adoption of ASU 2014-09
Revenue Disaggregation
Revenue		1,331.8		2,617.3
Aluminum
Revenue Disaggregation
Revenue	570		1,120.2
Aluminum | Before adoption of ASU 2014-09
Revenue Disaggregation
Revenue		487.8		970.9
Stainless steel
Revenue Disaggregation
Revenue	428.7		831.9
Stainless steel | Before adoption of ASU 2014-09
Revenue Disaggregation
Revenue		348		695.3
Alloy
Revenue Disaggregation
Revenue	172.5		341.5
Alloy | Before adoption of ASU 2014-09
Revenue Disaggregation
Revenue		145.8		291.1
Toll processing and logistics
Revenue Disaggregation
Revenue	104.3		$ 205.4
Number of days to perform services			1 day
Toll processing and logistics | Before adoption of ASU 2014-09
Revenue Disaggregation
Revenue		85.8		173
Other and eliminations
Revenue Disaggregation
Revenue	$ 71.2		$ 143.6
Other and eliminations | Before adoption of ASU 2014-09
Revenue Disaggregation
Revenue		$ 76		$ 146.9

Goodwill (Details)

Goodwill (Details) $ in Millions	6 Months Ended
	Jun. 30, 2018USD ($)
Change in the carrying amount of goodwill
Balance at the beginning of the period	$ 1,842.6
Acquisition	9.1
Effect of foreign currency translation	(3)
Balance at the end of the period	1,848.7
Accumulated impairment losses	0
Goodwill, tax deductible amount	$ 9.1

Intangible Assets, net (Details

Intangible Assets, net (Details) - USD ($) $ in Millions	6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Dec. 31, 2017
Intangible assets subject to amortization:
Intangible assets subject to amortization, Gross Carrying Amount	$ 765.9		$ 760.2
Intangible assets subject to amortization, Accumulated Amortization	(427.6)		(405.7)
Intangible assets
Intangible assets, Gross Carrying Amount	1,529.1		1,517.8
Amortization expense for intangible assets	23.7	$ 26.7
Changes in intangible assets due to foreign currency translation losses	2.3
Summary of estimated aggregate amortization expense for each of the succeeding five years
2018 (remaining six months)	23.7
2,019	47.3
2,020	47.3
2,021	43.2
2,022	35.1
2,023	29.1
DuBose
Intangible assets
Intangible assets, Gross Carrying Amount	15.7
Trade names
Intangible assets not subject to amortization:
Intangible assets not subject to amortization, Gross Carrying Amount	763.2		757.6
Trade names | DuBose
Intangible assets not subject to amortization:
Intangible assets not subject to amortization, Gross Carrying Amount	$ 6.6
Covenants not to compete
Intangible assets subject to amortization:
Weighted average amortizable life in years	4 years 9 months 18 days
Intangible assets subject to amortization, Gross Carrying Amount	$ 0.8		0.8
Intangible assets subject to amortization, Accumulated Amortization	$ (0.5)		(0.4)
Customer lists/relationships
Intangible assets subject to amortization:
Weighted average amortizable life in years	14 years 6 months
Intangible assets subject to amortization, Gross Carrying Amount	$ 751.1		745
Intangible assets subject to amortization, Accumulated Amortization	$ (413.3)		(391.3)
Software
Intangible assets subject to amortization:
Weighted average amortizable life in years	10 years
Intangible assets subject to amortization, Gross Carrying Amount	$ 8.1		8.1
Intangible assets subject to amortization, Accumulated Amortization	$ (8.1)		(8.1)
Other
Intangible assets subject to amortization:
Weighted average amortizable life in years	4 years 8 months 12 days
Intangible assets subject to amortization, Gross Carrying Amount	$ 5.9		6.3
Intangible assets subject to amortization, Accumulated Amortization	$ (5.7)		$ (5.9)

Debt - Summary (Details)

Debt - Summary (Details) - USD ($) $ in Millions	Jun. 30, 2018	Dec. 31, 2017
Debt
Total	$ 2,048.9	$ 1,914.5
Less: unamortized discount and debt issuance costs	(11.8)	(13.1)
Less: amounts due within one year and short-term borrowings	(104.4)	(92)
Total long-term debt	1,932.7	1,809.4
Unsecured revolving credit facility due September 30, 2021
Debt
Total	690	538
Unsecured term loan due from September 28, 2018 to September 30, 2021
Debt
Total	547.5	562.5
Senior unsecured notes due April 15, 2023
Debt
Total	500	500
Senior unsecured notes due November 15, 2036
Debt
Total	250	250
Other notes and revolving credit facilities
Debt
Total	$ 61.4	$ 64

Debt - Other (Details)

Debt - Other (Details) $ in Millions	Apr. 12, 2013USD ($)	Nov. 20, 2006USD ($)tranche	Sep. 30, 2016USD ($)	Jun. 30, 2018USD ($)item	Dec. 31, 2017USD ($)	Nov. 15, 2016USD ($)
Debt
Total				$ 2,048.9	$ 1,914.5
Number of financial covenants | item				2
Credit Agreement
Debt
Maximum borrowing capacity			$ 2,100
Debt term			5 years
Unsecured revolving credit facility due September 30, 2021
Debt
Maximum borrowing capacity			$ 1,500
Total				$ 690	$ 538
Additional maximum borrowing capacity under the credit agreement subject to approval of the lenders and certain other conditions			500
Commitment fee on unused portion of revolving credit facility (as a percent)				0.15%
Weighted average fixed interest rate (as a percent)				3.40%	2.96%
Letters of credit outstanding				$ 49.2
Available on the revolving credit facility				$ 760.8
Unsecured revolving credit facility due September 30, 2021 | LIBOR
Debt
Variable interest rate				LIBOR
Interest rate added to base (as a percent)				1.25%
Unsecured revolving credit facility due September 30, 2021 | Bank prime rate
Debt
Variable interest rate				bank prime
Interest rate added to base (as a percent)				0.25%
Unsecured term loan due from September 28, 2018 to September 30, 2021
Debt
Total				$ 547.5	$ 562.5
Debt amount			$ 600
Annual amortization of term loan through September 2018 (as a percent)			5.00%
Annual amortization of term loan thereafter until June 2021 (as a percent)			10.00%
Weighted average fixed interest rate (as a percent)				3.34%	2.82%
Unsecured term loan due from September 28, 2018 to September 30, 2021 | LIBOR
Debt
Variable interest rate				LIBOR
Interest rate added to base (as a percent)				1.25%
Unsecured term loan due from September 28, 2018 to September 30, 2021 | Bank prime rate
Debt
Variable interest rate				bank prime
Interest rate added to base (as a percent)				0.25%
Senior Unsecured Notes
Debt
Percentage of principal amount at which the notes may be required to be repurchased in event of a change of control and a downgrade of the entity's credit rating				101.00%
Senior unsecured notes issued November 20, 2006
Debt
Issuance of debt		$ 600
Number of tranches comprising the debt issuance | tranche		2
Senior unsecured notes due November 15, 2016
Debt
Total						$ 0
Interest rate (as a percent)		6.20%
Lump sum payment on maturity						$ 350
Issuance of debt		$ 350
Senior unsecured notes due April 15, 2023
Debt
Total				$ 500	$ 500
Interest rate (as a percent)	4.50%
Issuance of debt	$ 500
Senior unsecured notes due November 15, 2036
Debt
Total				250	250
Interest rate (as a percent)		6.85%
Issuance of debt		$ 250
Other notes and revolving credit facilities
Debt
Maximum borrowing capacity				63
Total				51.3	53.9
IRB
Debt
Total				$ 10.1	$ 10.1

Income Taxes (Details)

Income Taxes (Details) - USD ($) $ in Millions	3 Months Ended			6 Months Ended		12 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Dec. 31, 2010	Jun. 30, 2018	Jun. 30, 2017	Dec. 31, 2017
Income Taxes
Effective tax rate (as a percent)	24.00%	31.20%		24.00%	32.00%
Income tax at U.S. federal statutory tax rate (as a percent)				21.00%		35.00%
Tax Reform, provisional net tax benefit			$ 207.3

Equity - Share Repurchases, Div

Equity - Share Repurchases, Dividends, Stock-Based Compensation (Details) - USD ($) $ / shares in Units, $ in Millions	Jul. 25, 2018	Oct. 20, 2015	Mar. 31, 2018	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018
Share Repurchase Plan
Increase in authorized number of shares to be repurchased		7,500,000
Number of shares authorized by the Board of Directors to be repurchased under share repurchase plan				7,500,000		7,500,000		7,500,000
Number of shares authorized by the Board of Directors to be repurchased under share repurchase plan, expressed as a percentage of outstanding shares (as a percent)				10.00%		10.00%		10.00%
Share repurchases (in shares)								23,100,000
Average costs per share								$ 32.94
Common Stock and Additional Paid-In (in Shares)
Share repurchases (in shares)								23,100,000
Dividends
Common stock quarterly dividend per share (in dollars per share)	$ 0.50
Common stock dividend quarterly declared and paid per share (in dollars per share)				$ 0.50	$ 0.45	$ 1	$ 0.90
Dividends paid				$ 36.1	$ 32.8	$ 72.6	$ 65.6
RSU changes
Unvested at the beginning of the period (in shares)						924,575
Granted (in shares)						474,715
Vested (in shares)						(3,362)
Cancelled or forfeited (in shares)						(13,318)
Unvested at the end of the period (in shares)				1,382,610		1,382,610		1,382,610
Shares reserved for future grants (all plans)				1,368,824		1,368,824		1,368,824
Weighted Average Grant Date Fair Value
Unvested at the beginning of the period (in dollars per share)						$ 74.09
Granted (in dollars per shares)						84.26
Vested (in dollars per shares)						71.72
Cancelled or forfeited (in dollars per shares)						74.93
Unvested at the end of the period (in dollars per shares)				$ 77.58		$ 77.58		$ 77.58
Common Stock and Additional Paid in Capital
Share Repurchase Plan
Share repurchases (in shares)						(592,564)
Average costs per share						$ 84.38
Value of shares repurchased						$ 50
Common Stock and Additional Paid-In (in Shares)
Stock-based compensation ( in shares)				15,574		285,007
Stock options exercised (in shares)						48,275
Share repurchases (in shares)						(592,564)
Total ( in shares)				15,574		(259,282)
Stock-based compensation expense						$ 19.3
Payments made to tax authorities on employees' behalf						5.4
Common Stock and Additional Paid-In (in Amount)
Stock-based compensation				$ 12.9		13.9
Stock options exercised						2.8
Repurchase of common shares						(50)
Total				$ 12.9		$ (33.3)
Weighted Average Exercise/(Purchase) Price
Stock options exercised (in dollars per share)						$ 57.91
RSU's
Dividends
Dividend equivalents paid						$ 2	$ 0.9
Stock-Based Compensation
Vesting period (in years)						3 years
RSU changes
Granted (in shares)			474,715
RSU's | Performance-based
RSU changes
Granted (in shares)			178,970

Equity - Accumulated Other Comp

Equity - Accumulated Other Comprehensive Loss (Details) - USD ($) $ in Millions	6 Months Ended
	Jun. 30, 2018	Dec. 31, 2017
Schedule of accumulated other comprehensive loss
Balance at the beginning of the period	$ (71.6)
Current-period change	(14.1)
Balance at the end of the period	(85.7)
Deferred tax assets in accumulated other comprehensive loss, pension liabilities	13.6	$ 13.6
Foreign Currency Translation (Loss) Gain
Schedule of accumulated other comprehensive loss
Balance at the beginning of the period	(51.1)
Current-period change	(14.1)
Balance at the end of the period	(65.2)
Pension and Postretirement Benefit Adjustments, Net of Tax
Schedule of accumulated other comprehensive loss
Balance at the beginning of the period	(20.5)
Balance at the end of the period	$ (20.5)

Commitments and Contingencies -

Commitments and Contingencies - (Details)	Jun. 30, 2018
Environmental Contingencies
Ownership interest in domestic subsidiaries (as a percent)	100.00%

Earnings Per Share (Details)

Earnings Per Share (Details) - USD ($) $ / shares in Units, $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
Numerator:
Net income attributable to Reliance	$ 230.8	$ 103	$ 399.8	$ 214.7
Denominator:
Weighted average shares outstanding (in shares)	72,343,422	72,891,406	72,579,567	72,866,779
Dilutive effect of stock-based awards (in shares)	644,376	609,295	638,203	591,391
Weighted average diluted shares outstanding (in shares)	72,987,798	73,500,701	73,217,770	73,458,170
Earnings per share attributable to Reliance stockholders - diluted (in dollars per share)	$ 3.16	$ 1.40	$ 5.46	$ 2.92
Earnings per share attributable to Reliance stockholders - basic (in dollars per share)	$ 3.19	$ 1.41	$ 5.51	$ 2.95

Subsequent Events (Details)

Subsequent Events (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended		12 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017	Dec. 31, 2017
Subsequent Events
Net sales	$ 2,988.9	$ 2,475.2	$ 5,746	$ 4,894.5
KMS
Subsequent Events
Net sales					$ 23.3