Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2022 | Feb. 24, 2023 | Jun. 30, 2022 | |
Cover Abstract | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Dec. 31, 2022 | ||
Document Transition Report | false | ||
Entity File Number | 001-13122 | ||
Entity Registrant Name | RELIANCE STEEL & ALUMINUM CO | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 95-1142616 | ||
Entity Address, Address Line One | 16100 N. 71st Street, Suite 400 | ||
Entity Address, City or Town | Scottsdale | ||
Entity Address, State or Province | AZ | ||
Entity Address, Postal Zip Code | 85254 | ||
City Area Code | 480 | ||
Local Phone Number | 564-5700 | ||
Title of 12(b) Security | Common Stock, $0.001 par value | ||
Trading Symbol | RS | ||
Security Exchange Name | NYSE | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
ICFR Auditor Attestation Flag | true | ||
Entity Shell Company | false | ||
Entity Public Float | $ 10,280,000,000 | ||
Entity Common Stock, Shares Outstanding | 58,979,530 | ||
Entity Central Index Key | 0000861884 | ||
Current Fiscal Year End Date | --12-31 | ||
Document Fiscal Year Focus | 2022 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false | ||
Auditor Name | KPMG LLP | ||
Auditor Firm ID | 185 | ||
Auditor Location | Los Angeles, California |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Millions | Dec. 31, 2022 | Dec. 31, 2021 |
Current assets: | ||
Cash and cash equivalents | $ 1,173.4 | $ 300.5 |
Accounts receivable, less allowance for credit losses of $26.1 at December 31, 2022 and $26.7 at December 31, 2021 | 1,565.7 | 1,683 |
Inventories | 1,995.3 | 2,065 |
Prepaid expenses and other current assets | 115.6 | 111.6 |
Income taxes receivable | 36.6 | |
Total current assets | 4,886.6 | 4,160.1 |
Property, plant and equipment: | ||
Land | 262.7 | 260.1 |
Buildings | 1,359.3 | 1,285 |
Machinery and equipment | 2,446.9 | 2,241.4 |
Accumulated depreciation | (2,094.3) | (1,949.7) |
Property, plant and equipment, net | 1,974.6 | 1,836.8 |
Operating lease right-of-use assets | 216.4 | 224.6 |
Goodwill | 2,105.9 | 2,107.6 |
Intangible assets, net | 1,019.6 | 1,077.7 |
Cash surrender value of life insurance policies, net | 42 | 44.9 |
Other assets | 84.8 | 84.3 |
Total assets | 10,329.9 | 9,536 |
Current liabilities: | ||
Accounts payable | 412.4 | 453.9 |
Accrued expenses | 118.8 | 148.2 |
Accrued compensation and retirement benefits | 240 | 294 |
Accrued insurance costs | 43.4 | 41 |
Current maturities of long-term debt and short-term borrowings | 508.2 | 5 |
Current maturities of operating lease liabilities | 52.5 | 58.6 |
Income taxes payable | 64.3 | |
Total current liabilities | 1,375.3 | 1,065 |
Long-term debt | 1,139.4 | 1,642 |
Operating lease liabilities | 165.2 | 162.5 |
Long-term retirement benefits | 26.1 | 37.8 |
Other long-term liabilities | 51.4 | 50.2 |
Deferred income taxes | 476.6 | 484.8 |
Commitments and contingencies | ||
Equity: | ||
Preferred stock, $0.001 par value: 5,000 shares authorized; none issued or outstanding | ||
Common stock and additional paid-in capital, $0.001 par value and 200,000 shares authorized, Issued and outstanding shares-58,787 at December 31, 2022 and 61,806 at December 31, 2021 | 0.1 | 0.1 |
Retained earnings | 7,173.6 | 6,155.3 |
Accumulated other comprehensive loss | (86.3) | (68.9) |
Total Reliance stockholders' equity | 7,087.4 | 6,086.5 |
Noncontrolling interests | 8.5 | 7.2 |
Total equity | 7,095.9 | 6,093.7 |
Total liabilities and equity | $ 10,329.9 | $ 9,536 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Millions | Dec. 31, 2022 | Dec. 31, 2021 |
CONSOLIDATED BALANCE SHEETS | ||
Accounts receivable, allowance for credit losses | $ 26.1 | $ 26.7 |
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 | 58,787,000 | 61,806,000 |
Common stock, outstanding shares | 58,787,000 | 61,806,000 |
CONSOLIDATED STATEMENTS OF INCO
CONSOLIDATED STATEMENTS OF INCOME - USD ($) shares in Thousands, $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
CONSOLIDATED STATEMENTS OF INCOME | |||
Net sales | $ 17,025 | $ 14,093.3 | $ 8,811.9 |
Costs and expenses: | |||
Cost of sales (exclusive of depreciation and amortization shown below) | 11,773.7 | 9,603 | 6,036.8 |
Warehouse, delivery, selling, general and administrative | 2,504.2 | 2,306.5 | 1,874 |
Depreciation and amortization | 240.2 | 230.2 | 227.3 |
Impairment of long-lived assets | 4.7 | 108 | |
Total costs and expenses | 14,518.1 | 12,144.4 | 8,246.1 |
Operating income | 2,506.9 | 1,948.9 | 565.8 |
Other expense: | |||
Interest expense | 62.3 | 62.7 | 62.9 |
Other expense, net | 14.2 | 3.1 | 24.7 |
Income before income taxes | 2,430.4 | 1,883.1 | 478.2 |
Income tax provision | 586.2 | 465.7 | 105.8 |
Net income | 1,844.2 | 1,417.4 | 372.4 |
Less: net income attributable to noncontrolling interests | 4.1 | 4.4 | 3.3 |
Net income attributable to Reliance | $ 1,840.1 | $ 1,413 | $ 369.1 |
Earnings per share attributable to Reliance stockholders: | |||
Basic (in dollars per share) | $ 30.39 | $ 22.35 | $ 5.74 |
Diluted (in dollars per share) | $ 29.92 | $ 21.97 | $ 5.66 |
Shares used in computing earnings per share: | |||
Basic (in shares) | 60,559 | 63,217 | 64,328 |
Diluted (in shares) | 61,495 | 64,327 | 65,263 |
Cash dividends per share (in dollars per share) | $ 3.50 | $ 2.75 | $ 2.50 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME | |||
Net income | $ 1,844.2 | $ 1,417.4 | $ 372.4 |
Other comprehensive (loss) income: | |||
Foreign currency translation (loss) gain | (28.8) | (2.5) | 11.7 |
Pension and postretirement benefit adjustments, net of tax | 11.4 | 11.5 | 15.5 |
Total other comprehensive (loss) income | (17.4) | 9 | 27.2 |
Comprehensive income | 1,826.8 | 1,426.4 | 399.6 |
Less: comprehensive income attributable to noncontrolling interests | 4.1 | 4.4 | 3.3 |
Comprehensive income attributable to Reliance | $ 1,822.7 | $ 1,422 | $ 396.3 |
CONSOLIDATED STATEMENTS OF EQUI
CONSOLIDATED STATEMENTS OF EQUITY - USD ($) $ in Millions | Reliance Shareholders' | Common Stock and Additional Paid in Capital | Retained Earnings | Accumulated Other Comprehensive Loss | Non-controlling Interests | Total |
Balances at Dec. 31, 2019 | $ 122.2 | $ 5,189.5 | $ (105.1) | $ 7.5 | $ 5,214.1 | |
Increase (Decrease) in Stockholders' Equity | ||||||
Net income attributable to Reliance | 369.1 | 372.4 | ||||
Cash dividends and dividend equivalents | (164.1) | |||||
Other comprehensive (loss) income | 27.2 | 3.3 | 27.2 | |||
Dividends paid | (2.4) | |||||
Stock-based compensation | 42.2 | |||||
Common stock withheld related to net share settlements | (23.1) | |||||
Repurchase of common shares | (136) | (201.3) | (337.3) | |||
Noncontrolling interest purchased | (5.5) | (1.1) | ||||
Stock options exercised | 0.3 | |||||
Balances at Dec. 31, 2020 | $ 5,115.4 | 0.1 | 5,193.2 | (77.9) | 7.3 | 5,122.7 |
Increase (Decrease) in Stockholders' Equity | ||||||
Net income attributable to Reliance | 1,413 | 1,417.4 | ||||
Cash dividends and dividend equivalents | (177) | |||||
Other comprehensive (loss) income | 9 | 4.4 | 9 | |||
Dividends paid | (4.5) | |||||
Stock-based compensation | 70.8 | |||||
Common stock withheld related to net share settlements | (21.2) | |||||
Repurchase of common shares | (49.6) | (273.9) | (323.5) | |||
Balances at Dec. 31, 2021 | 6,086.5 | 0.1 | 6,155.3 | (68.9) | 7.2 | 6,093.7 |
Increase (Decrease) in Stockholders' Equity | ||||||
Net income attributable to Reliance | 1,840.1 | 1,844.2 | ||||
Cash dividends and dividend equivalents | (217.1) | |||||
Other comprehensive (loss) income | (17.4) | 4.1 | (17.4) | |||
Capital contributions | 0.3 | |||||
Dividends paid | (3.1) | |||||
Stock-based compensation | 65.3 | |||||
Common stock withheld related to net share settlements | (39.7) | |||||
Repurchase of common shares | (25.6) | (604.7) | (630.3) | |||
Balances at Dec. 31, 2022 | $ 7,087.4 | $ 0.1 | $ 7,173.6 | $ (86.3) | $ 8.5 | $ 7,095.9 |
CONSOLIDATED STATEMENTS OF EQ_2
CONSOLIDATED STATEMENTS OF EQUITY (Parenthetical) - $ / shares | 1 Months Ended | 12 Months Ended | ||||||
Feb. 28, 2023 | Feb. 28, 2022 | Feb. 28, 2021 | Feb. 29, 2020 | Feb. 28, 2019 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
CONSOLIDATED STATEMENTS OF EQUITY | ||||||||
Cash dividends declared per common share (in dollars per share) | $ 1 | $ 0.875 | $ 0.6875 | $ 0.625 | $ 0.55 | $ 3.50 | $ 2.75 | $ 2.50 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Operating activities: | |||
Net income | $ 1,844.2 | $ 1,417.4 | $ 372.4 |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Depreciation and amortization expense | 240.2 | 230.2 | 227.3 |
Impairment of long-lived assets | 4.7 | 108 | |
Provision for credit losses | 3.4 | 9.8 | 5.8 |
Deferred income tax benefit | (6.7) | (23.8) | (13.7) |
Stock-based compensation expense | 65.3 | 70.8 | 42.2 |
Net loss on life insurance policies and deferred compensation plan assets | 22.4 | 5 | 4.6 |
Pension postretirement benefit plan settlement expense | 2.3 | 19.4 | |
Other | 2.5 | (5) | 6.7 |
Changes in operating assets and liabilities (excluding effect of businesses acquired): | |||
Accounts receivable | 105.7 | (656.1) | 136.8 |
Inventories | 58.9 | (505.9) | 227.5 |
Prepaid expenses and other assets | 17.4 | 26.2 | 79.4 |
Accounts payable and other liabilities | (237) | 226.1 | (43.4) |
Net cash provided by operating activities | 2,118.6 | 799.4 | 1,173 |
Investing activities: | |||
Acquisitions, net of cash acquired | (439.3) | (6.9) | |
Purchases of property, plant and equipment | (341.8) | (236.6) | (172) |
Proceeds from sales of property, plant and equipment | 10.9 | 36 | 6.7 |
Other | (17.6) | (12.4) | (16.2) |
Net cash used in investing activities | (348.5) | (652.3) | (188.4) |
Financing activities: | |||
Net short-term debt (repayments) borrowings | (2.2) | (0.8) | 0.7 |
Proceeds from long-term debt borrowings | 20 | 1,673.5 | |
Principal payments on long-term debt | (0.3) | (20.7) | (1,615.4) |
Debt issuance costs | (6.4) | ||
Cash dividends and dividend equivalents | (217.1) | (177) | (164.1) |
Share repurchases | (630.3) | (323.5) | (337.3) |
Payments for taxes related to net share settlements | (39.7) | (21.2) | (23.1) |
Noncontrolling interest purchased | (8) | ||
Other | (3) | (5.7) | (2.9) |
Net cash used in financing activities | (892.6) | (528.9) | (483) |
Effect of exchange rate changes on cash and cash equivalents | (4.6) | (1.2) | 7.6 |
Increase (decrease) in cash and cash equivalents | 872.9 | (383) | 509.2 |
Cash and cash equivalents at beginning of year | 300.5 | 683.5 | 174.3 |
Cash and cash equivalents at end of year | 1,173.4 | 300.5 | 683.5 |
Supplemental cash flow information: | |||
Interest paid during the period | 59.7 | 59.1 | 52.6 |
Income taxes paid during the year, net | $ 692.4 | $ 444.4 | $ 87.5 |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2022 | |
Summary of Significant Accounting Policies | |
Summary of Significant Accounting Policies | Note 1. Summary of Significant Accounting Policie s Principles of Consolidation The accompanying consolidated financial statements include the accounts of Reliance Steel & Aluminum Co. and its subsidiaries (collectively referred to as “Reliance”, “the Company”, “we”, “our” or “us”). 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 interests in our consolidated subsidiaries held by others are reflected as noncontrolling interests. Our investments in unconsolidated subsidiaries are recorded under the equity method of accounting. Business As a global diversified metal solutions provider, we operate a network of approximately 315 locations in 40 states and in 12 foreign countries (Belgium, Canada, China, France, India, Malaysia, Mexico, Singapore, South Korea, Turkey, the United Arab Emirates and the United Kingdom) that provides value-added metals processing services and distributes a full line of more than 100,000 metal products. Reclassification The accompanying consolidated balance sheet as of December 31, 2021 includes a reclassification of $43.2 million of deferred compensation plan liabilities from Long-term retirement benefits to Other long-term liabilities Accounting Estimates The preparation of financial statements in conformity with U.S. generally accepted accounting principles (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, such as allowances for credit losses, net realizable values of inventories, fair values and/or impairment of goodwill and other indefinite-lived intangible assets, long-lived assets, the amount of unrecognized tax benefits and other contingencies, and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. The Company bases its estimates on historical experience and on various other assumptions that the Company believes to be reasonable under the circumstances. Actual results could differ from those estimates. Accounts Receivable and Concentrations of Credit Risk Trade receivables are typically non-interest bearing and are recorded at amortized cost. Sales to our recurring customers are generally made on open account terms while sales to occasional customers may be made on a collect on delivery basis. Past due status of customer accounts is determined based on how recently payments have been received in relation to payment terms granted. Credit is generally extended based upon an evaluation of each customer’s financial condition, with terms consistent in the industry and no collateral is required. The allowance for credit losses reflects the expected losses on our trade receivables and is determined based on customer-specific facts and the consideration of historical loss information, current conditions and reasonable and supportable forecasts using a loss-rate approach. Amounts are written-off against the allowance in the period we determine that the receivable is uncollectible. Concentrations of credit risk with respect to trade receivables are limited due to the geographically diverse customer base, with limited exposure to any single customer account, and various industries into which our products are sold. We do not consider ourselves to have any significant concentrations of credit risk. Inventories The majority of our inventory is valued using the last-in, first-out (“LIFO”) method, which is not in excess of market. Under this method, older costs are included in inventory, which may be higher or lower than current costs. This method of valuation is subject to year-to-year fluctuations in cost of material sold, which is influenced by the inflation or deflation existing within the metal wholesaling industry as well as fluctuations in our product mix and on-hand inventory levels. Fair Values of Financial Instruments Fair values of cash and cash equivalents, accounts receivable, accounts payable, accrued expenses and other current liabilities, and current maturities of operating lease liabilities approximate carrying values due to the short period of time to maturity. Fair values of long-term debt, which have been determined based on borrowing rates currently available to us or to other companies with comparable credit ratings, for loans with similar terms or maturity, approximate the carrying amounts in the consolidated financial statements, with the exception of our publicly traded senior unsecured notes with an aggregate face value of $1.65 billion as of December 31, 2022 and 2021. The aggregate fair value of these senior unsecured notes based on quoted market prices was $1.53 billion and $1.75 billion at December 31, 2022 and 2021, respectively, compared to their aggregate carrying value of $1.64 billion. The estimated fair values of our senior unsecured notes are based on Level 2 inputs, including benchmark yields, reported trades and broker/dealer quotes. Fair values of our other financial instruments, which include assets held within rabbi trusts, are comprised of assets that are generally based on quoted market prices for identical instruments that trade in active markets. Cash Equivalents We consider all highly liquid instruments with an original maturity of three months or less when purchased to be cash equivalents. We maintain cash and cash equivalents with high credit quality financial institutions. The Company, by policy, limits the amount of credit exposure to any one financial institution. Goodwill and Other Indefinite-Lived Intangible Assets Goodwill is the excess of purchase price over the fair value of identified assets and liabilities of businesses acquired. Other indefinite-lived intangible assets include amounts allocated to the trade names of businesses acquired. Goodwill and other indefinite-lived intangible assets are not amortized but are tested for impairment at least annually. We test for impairment of goodwill and intangible assets deemed to have indefinite lives annually and, between annual tests, whenever significant events or changes occur based on an assessment of qualitative factors to determine if it is more likely than not that the fair value is less than the carrying value. We have one operating segment and one reporting unit for goodwill impairment purposes. We calculate the fair value of the reporting unit using our market capitalization or the discounted cash flow method, as necessary, and compare the fair value to the carrying value of the reporting unit to determine if impairment exists. We perform our annual impairment evaluations of goodwill and other indefinite-lived intangible assets on November 1 of each year. No impairment of goodwill was determined to exist in any of the years presented. We recognized impairment losses of $4.7 million and $67.8 million related to our other intangible assets with indefinite lives in 2021 and 2020. No impairment losses were recognized related to our other intangible assets with indefinite lives in 2022. See Note 19—“Impairment and Restructuring Charges” Long-Lived Assets Property, plant and equipment is recorded at cost (or at fair value for assets acquired in connection with business combinations) and the provision for depreciation of these assets is generally computed on the straight-line method at rates designed to distribute the cost of assets over the useful lives, estimated as follows: buildings, including leasehold improvements, over five three Intangible assets with finite useful lives are amortized over their useful lives. We periodically review the recoverability of our property, plant and equipment and intangible assets subject to amortization whenever events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable. We didn’t recognize any impairment losses for long-lived assets in 2022 and 2021. We recognized $9.3 million of impairment Note 19—“Impairment and Restructuring Charges” Leases We determine if an arrangement is a lease at inception. Our lease agreements generally contain only lease components. Our lease payments are generally fixed with certain leases containing variable payments related to Consumer Price Index (“CPI”) annual adjustments. Right-of-use assets and lease liabilities are recognized on the balance sheet at the present value of the future lease payments at the lease commencement date. Certain of our lease terms include periods under renewal options when it is reasonably certain that we will exercise that option. We generally include optional renewal periods when determining our lease terms and future lease payments. The interest rate used to determine the present value of future lease payments is our incremental borrowing rate that is estimated to approximate the interest rate on a collateralized basis with similar terms and payments. Operating lease cost is recognized on a straight-line basis over the lease term. 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. Sales and value-added taxes collected from customers are excluded from our reported sales. 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 is not significant as of December 31, 2022, 2021 and 2020. Metal Sales We have minimal long-term contract sales with our customers as we primarily transact in the spot market under fixed price sales orders. The majority of our metal product sales orders generally have only one performance obligation: sale of processed or unprocessed metal product. 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. In 2022, 2021 and 2020, shipping and handling costs included in Warehouse, delivery, selling, general and administrative (“SG&A”) expenses were $509.7 million, $424.6 million and $357.4 million, respectively. 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 and storage services for metal we toll process. Revenue for these services is recognized over time as the toll processing or logistics services are performed. The toll processing 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. 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. The number of shipping days in each quarter also has an impact on our quarterly sales and profitability. We cannot predict whether period-to-period fluctuations will be consistent with historical patterns. Results of any one or more quarters are therefore not necessarily indicative of annual results. Stock-Based Compensation All of our stock-based compensation plans are considered equity plans. The fair value of stock awards and restricted stock units is determined based on the fair value of our common stock on the grant date. The fair value of stock awards and restricted stock units is expensed on a straight-line basis over their respective vesting periods, net of forfeitures when they occur. Stock-based compensation expense was $65.3 million, $70.8 million and $42.2 million in 2022, 2021 and 2020, respectively, and is included in the SG&A caption of our consolidated statements of income. Environmental Remediation Costs We accrue for losses associated with environmental remediation obligations when such losses are probable and reasonably estimable. Accruals for estimated losses from environmental remediation obligations generally are recognized no later than completion of the remediation feasibility study. Such accruals are adjusted as further information develops or circumstances change. Recoveries of environmental remediation costs from insurance policies and other parties are recorded as assets when their receipt is deemed probable. We are not aware of any environmental remediation obligations that would materially affect our operations, financial position or cash flows. See Note 16—“Commitments and Contingencies” Income Taxes We file a consolidated U.S. federal income tax return with our wholly owned domestic subsidiaries. Deferred tax assets and liabilities are recognized for the expected future tax consequences of temporary differences between the financial reporting and tax reporting bases of assets and liabilities using the enacted tax rates expected to be in effect when such differences are realized or settled. The effect on deferred taxes from a change in tax rates is recognized in income in the period that includes the enactment date of the change. The provision for income taxes reflects the taxes to be paid for the period and the change during the period in the deferred tax assets and liabilities. We evaluate on a quarterly basis whether, based on all available evidence, it is probable that the deferred income tax assets are realizable. Valuation allowances are established when it is estimated that it is more likely than not that the tax benefit of the deferred tax asset will not be realized. We perform a comprehensive review of our uncertain tax positions on a quarterly basis. Tax benefits are recognized when it is more likely than not that a tax position will be sustained upon examination by the authorities. The benefit from a position that has surpassed the more-likely-than-not threshold is measured as the largest amount of benefit that is more than 50% likely to be realized upon settlement. We recognize interest and penalties accrued related to unrecognized tax benefits as a component of income tax expense. Foreign Currencies The currency effects of translating into U.S. dollars the financial statements of our foreign subsidiaries, which typically use the local currency of the countries in which they are located, are included in other comprehensive (loss) income. Gains and losses resulting from foreign currency transactions are included in the results of operations in the Other expense, net caption and amounted to $6.2 million, $4.0 million and $2.3 million of losses in 2022, 2021 and 2020, respectively. Impact of Recently Issued Accounting Standards—Adopted Reference Rate Reform Note 9—“Debt” |
Acquisitions
Acquisitions | 12 Months Ended |
Dec. 31, 2022 | |
Acquisitions | |
Acquisitions | Note 2. Acquisitions 2021 Acquisitions In the fourth quarter of 2021, we acquired each of Merfish United, Inc., Admiral Metals Servicenter Company, Incorporated, Nu-Tech Precision Metals Inc. and Rotax Metals Inc. with cash on hand. Included in our net sales for the year ended December 31, 2022 were combined net sales of $863.0 million from our 2021 acquisitions. The allocation of the total purchase price for our 2021 acquisitions to the fair values of the assets acquired and liabilities assumed was as follows: (in millions) Cash $ 1.0 Accounts receivable 107.2 Inventories 134.4 Property, plant and equipment 33.6 Operating lease right-of-use assets 29.8 Goodwill 177.3 Intangible assets subject to amortization 116.3 Intangible assets not subject to amortization 51.2 Other current and long-term assets 4.0 Total assets acquired 654.8 Deferred taxes 48.6 Operating lease liabilities 24.6 Other current and long-term liabilities 141.3 Total liabilities assumed 214.5 Net assets acquired $ 440.3 Summary purchase price allocation information for all acquisitions All of the acquisitions discussed in this note have been accounted for under the acquisition method of accounting and, accordingly, each purchase price has been allocated to the assets acquired and liabilities assumed based on the 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 allocations of each acquisition’s purchase price as of December 31, 2022 or 2021, as applicable. The measurement periods for purchase price allocations do not exceed 12 months from the acquisition date. As part of the purchase price allocations for the 2021 acquisitions, we allocated $51.2 million to the trade names acquired. We determined that all of the trade names acquired in connection with these acquisitions had indefinite lives since their economic lives are expected to approximate the life of each company acquired. We recorded other identifiable intangible assets related to customer relationships for the 2021 acquisitions of $92.3 million with weighted average lives of 10.0 years, and an identifiable other intangible asset related to production backlog of $23.8 million with an average life of 7.9 years. The goodwill arising from our 2021 acquisitions consists largely of expected strategic benefits, including enhanced financial and operational scale, as well as expansion of acquired product and processing know-how across our enterprise. Goodwill of $106.4 million from our 2021 acquisitions is deductible for tax purposes. Total goodwill deductible for tax purposes was $854.5 million as of December 31, 2022. Unaudited Pro forma financial information for all acquisitions The following unaudited pro forma summary financial results present the consolidated results of operations as if our 2021 acquisitions had occurred as of January 1, 2020, after the effect of certain adjustments, including non-recurring acquisition-related costs, amortization of inventory step-up to fair value adjustments included in cost of sales, depreciation and amortization of certain identifiable property, plant and equipment and intangible assets, and lease cost fair value adjustments. The pro forma summary financial results for the year ended December 31, 2021 excluded $7.7 million of acquisition-related costs. The pro forma results have been presented for comparative purposes only and are not indicative of what would have occurred had the 2021 acquisitions been made as of January 1, 2020, or of any potential results which may occur in the future. Year Ended December 31, 2021 2020 (in millions, except per share amounts) Pro forma: Net sales $ 14,820.5 $ 9,345.4 Net income attributable to Reliance $ 1,518.0 $ 356.6 Earnings per share attributable to Reliance stockholders: Basic $ 24.01 $ 5.54 Diluted $ 23.60 $ 5.46 The pro forma amounts presented for the year ended December 31, 2020 include $21.8 million of non-recurring amortization of inventory step-up to fair value adjustments, $7.8 million of non-recurring excess renumeration paid to former owners and employees, and $7.7 million of non-recurring acquisition-related costs. As adjusted for these non-recurring items, pro forma net income attributable to Reliance was $384.6 million and pro forma diluted earnings per share were $5.89 for the year ended December 31, 2020. |
Joint Ventures and Noncontrolli
Joint Ventures and Noncontrolling Interests | 12 Months Ended |
Dec. 31, 2022 | |
Joint Ventures and Noncontrolling Interests | |
Joint Ventures and Noncontrolling Interests | Note 3. Joint Ventures and Noncontrolling Interests The equity method of accounting is used where our investment in voting stock gives us the ability to exercise significant influence over the investee, generally 20% to 50%. The financial results of investees are generally consolidated when the ownership interest is greater than 50%. Operations that are majority owned by us are as follows: Indiana Pickling and Processing Company (56%-owned), and Valex Corp.’s operations in South Korea, in which Valex Corp. has a 96% ownership. The results of these majority-owned operations are consolidated in our financial results. The portion of the earnings related to the noncontrolling shareholder interests has been reflected in the Net income attributable to noncontrolling interests caption in the accompanying consolidated statements of income. On March 31, 2020, through our wholly owned subsidiary, Feralloy Corporation, we purchased the remaining 49% noncontrolling interest of Feralloy Processing Company, an Indiana partnership (“FPC”) and toll processor in Portage, Indiana. We have consolidated the financial results of FPC since August 1, 2008 when we acquired Feralloy Corporation as part of our acquisition of PNA Group, Inc. Consequently, the increase in our ownership from 51% to 100% was accounted for as an equity transaction. The $5.5 million decrease in total Reliance stockholders’ equity recognized from the transaction was comprised of $8.0 million of cash consideration paid for the noncontrolling interest less its carrying amount of $1.1 million and $1.4 million of direct tax effects resulting from the transaction. |
Inventories
Inventories | 12 Months Ended |
Dec. 31, 2022 | |
Inventories | |
Inventories | Note 4. Inventories Our inventories are primarily stated on the LIFO method, which is not in excess of market. We use the LIFO method of inventory valuation because it results in a better matching of costs and revenues. The cost of inventories stated on the first-in, first-out (“FIFO”) method is not in excess of net realizable value. Inventories consisted of the following: December 31, December 31, 2022 2021 (in millions) LIFO inventories - cost on FIFO method $ 2,257.9 $ 2,498.2 Cost on FIFO method higher than LIFO value (743.8) (820.4) Inventories - stated on LIFO method 1,514.1 1,677.8 Inventories - stated on FIFO method 481.2 387.2 $ 1,995.3 $ 2,065.0 The changes in the LIFO inventory valuation reserve were as follows: Year Ended December 31, 2022 2021 2020 (in millions) LIFO inventory valuation reserve (income) expense $ (76.6) $ 704.8 $ (22.0) Cost decreases for the majority of our products were the primary cause of the 2022 and 2020 LIFO inventory valuation reserve adjustment being a credit, or income. Cost increases for the majority of our products were the primary cause of the 2021 LIFO inventory valuation reserve adjustment being a charge, or expense. There were insignificant liquidations of LIFO inventory quantities for all years presented. |
Revenues
Revenues | 12 Months Ended |
Dec. 31, 2022 | |
Revenues. | |
Revenues | Note 5. Revenues The following table presents our sales disaggregated by product and service. Year Ended December 31, 2022 2021 2020 (in millions) Carbon steel $ 9,487.7 $ 8,532.0 $ 4,647.4 Stainless steel 2,877.4 2,267.0 1,435.6 Aluminum 2,658.7 2,050.9 1,687.6 Alloy 741.0 547.5 436.5 Toll processing and logistics 554.2 470.7 387.5 Copper and brass 336.7 112.2 50.5 Other and eliminations 369.3 113.0 166.8 Total $ 17,025.0 $ 14,093.3 $ 8,811.9 |
Goodwill
Goodwill | 12 Months Ended |
Dec. 31, 2022 | |
Goodwill. | |
Goodwill | Note 6. Goodwill The changes in the carrying amount of goodwill are as follows: (in millions) Balance at January 1, 2021 $ 1,935.2 Acquisitions 172.0 Effect of foreign currency translation 0.4 Balance at December 31, 2021 2,107.6 Purchase price allocation adjustments 5.3 Effect of foreign currency translation (7.0) Balance at December 31, 2022 $ 2,105.9 We had no accumulated impairment losses related to goodwill at December 31, 2022 and 2021. |
Intangible Assets, net
Intangible Assets, net | 12 Months Ended |
Dec. 31, 2022 | |
Intangible Assets, net | |
Intangible Assets, net | Note 7. Intangible Assets, net Intangible assets, net, consisted of the following: December 31, 2022 December 31, 2021 Weighted Average Gross Gross Amortizable Carrying Accumulated Carrying Accumulated Life in Years Amount Amortization Amount Amortization (in millions) Intangible assets subject to amortization: Customer lists/relationships 14.2 $ 713.6 $ (479.3) $ 713.0 $ (435.1) Backlog of orders 7.9 22.3 (3.1) 15.8 (0.2) Other 9.1 9.9 (9.5) 9.9 (9.4) 745.8 (491.9) 738.7 (444.7) Intangible assets not subject to amortization: Trade names 765.7 — 783.7 — $ 1,511.5 $ (491.9) $ 1,522.4 $ (444.7) Certain 2021 amounts have been reclassified for consistency with the current period presentation. In 2022, we recorded purchase price adjustments relating to our 2021 acquisitions based on the finalization of intangible asset valuations that decreased trade name intangible assets by $16.9 million, increased the backlog of orders intangible asset by $8.0 million and increased customer lists/relationships intangible assets Note 2—“Acquisitions” During 2021, we recognized impairment losses of $4.7 million on our trade name intangible assets and a total of $98.5 million of impairment losses in 2020, comprised of $67.8 million on our trade name intangible assets and $30.7 million on our customer relationship intangible assets. See Note 19—“Impairment and Restructuring Charges” Amortization expense for intangible assets amounted to $48.1 million, $38.7 million and $39.6 million in 2022, 2021 and 2020, respectively. Foreign currency translation losses were $4.0 million in 2022 compared to gains of $0.3 million in 2021. The following is a summary of estimated aggregate amortization expense for each of the next five years: (in millions) 2023 $ 43.6 2024 40.1 2025 35.9 2026 26.4 2027 25.8 |
Cash Surrender Value of Life In
Cash Surrender Value of Life Insurance Policies, net | 12 Months Ended |
Dec. 31, 2022 | |
Cash Surrender Value of Life Insurance Policies, net | |
Cash Surrender Value of Life Insurance Policies, net | Note 8. Cash Surrender Value of Life Insurance Policies, net The cash surrender value of all life insurance policies held by us, net of loans and related accrued interest, was $42.0 million and $44.9 million as of December 31, 2022 and 2021, respectively. Our wholly owned subsidiary, Earle M. Jorgensen Company (“EMJ”), is the owner and beneficiary of life insurance policies on all former nonunion employees of a predecessor company, including certain current employees of EMJ. These policies, by providing payments to EMJ upon the death of covered individuals, were designed to provide cash to EMJ in order to repurchase shares held by employees in EMJ’s former employee stock ownership plan and shares held individually by employees upon the termination of their employment. Reliance is also the beneficiary of key person life insurance policies held by a rabbi trust for the benefit of participants of the Reliance Supplemental Executive Retirement Plan. Cash surrender value of the life insurance policies increases by a portion of the amount of premiums paid and by investment income earned under the policies and decreases by the amount of cost of insurance charges, investment losses and interest on policy loans, as applicable. Annually, we borrow against the cash surrender value of policies to pay a portion of the premiums and accrued interest owed on loans against those policies. We borrowed $73.1 million, $68.0 million and $60.0 million, respectively, against the cash surrender value of certain policies, which was used to partially pay premiums and accrued interest owed of $93.0 million, $86.3 million and $76.8 million in 2022, 2021 and 2020, respectively. The interest rate on outstanding borrowings under the EMJ life insurance policies is fixed at 11.76% and the portion of the policy cash surrender value that the borrowings relate to earns interest and dividend income at 11.26%. The unborrowed portion of the policy cash surrender value earns income at a rate commensurate with certain risk-free U.S. Treasury bond yields but not less than 4.0%. All other life insurance policies earn investment income or incur losses based on the performance of the underlying investments held by the policies. As of December 31, 2022 and 2021, loans and accrued interest outstanding on EMJ’s life insurance policies were $849.5 million and $789.1 million, respectively. Income earned on our life insurance policies, cost of insurance charges and interest expense on borrowings against cash surrender values are included in the Other expense, net caption in the accompanying consolidated statements of income. See Note 15—“Other Expense (Income), net” |
Debt
Debt | 12 Months Ended |
Dec. 31, 2022 | |
Debt | |
Debt | Note 9. Debt Debt consisted of the following: December 31, December 31, 2022 2021 (in millions) Unsecured revolving credit facility maturing September 3, 2025 $ — $ — Senior unsecured notes, interest payable semi-annually at 4.50%, effective rate of 4.63%, redeemed on January 15, 2023 500.0 500.0 Senior unsecured notes, interest payable semi-annually at 1.30%, effective rate of 1.53%, maturing August 15, 2025 400.0 400.0 Senior unsecured notes, interest payable semi-annually at 2.15%, effective rate of 2.27%, maturing August 15, 2030 500.0 500.0 Senior unsecured notes, interest payable semi-annually at 6.85%, effective rate of 6.91%, maturing November 15, 2036 250.0 250.0 Other notes and revolving credit facilities 9.6 12.4 Total 1,659.6 1,662.4 Less: unamortized discount and debt issuance costs (12.0) (15.4) Less: amounts due within one year and short-term borrowings (508.2) (5.0) Total long-term debt $ 1,139.4 $ 1,642.0 Unsecured Credit Facility On September 3, 2020, we entered into a $1.5 billion unsecured five-year Amended and Restated Credit Agreement that amended and restated our then-existing $1.5 billion unsecured revolving credit facility. On January 12, 2023, the agreement was further amended to change the reference rate from LIBOR to SOFR (as amended, the “Credit Agreement”). Following the amendment, borrowings under the Credit Agreement were available at variable rates based on SOFR plus 1.10% or the bank prime rate and we currently pay a commitment fee at an annual rate of 0.175% on the unused portion of the revolving credit facility. The applicable margins over SOFR and base rate borrowings, along with commitment fees, are subject to adjustment every quarter based on our leverage ratio, as defined in the Credit Agreement. All borrowings under the Credit Agreement may be prepaid without penalty. As of December 31, 2022 and 2021, we had no outstanding borrowings on the revolving credit facility. As of December 31, 2022 and 2021, we had $7.7 million and $8.9 million, respectively, of letters of credit outstanding under the revolving credit facility. Senior Unsecured Notes On January 15, 2023, we redeemed the $500.0 million aggregate outstanding principal amount of our 4.50% senior notes due 2023 in full. We funded this redemption using cash on hand. 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 make an offer to repurchase each series of the notes at a price equal to 101% of their principal amount plus accrued and unpaid interest. Other Notes, Revolving Credit and Letters of Credit/Letters of Guarantee Facilities A revolving credit facility with a credit limit of $7.8 million is in place for an operation in Asia with an outstanding balance of $2.2 million and $4.7 million as of December 31, 2022 and 2021, respectively. Various industrial revenue bonds had combined outstanding balances of $7.4 million and $7.7 million as of December 31, 2022 and 2021, respectively, and have maturities through 2027. A standby letters of credit/letters of guarantee agreement with one of the lenders under our Credit Agreement provides letters of credit and/or letters of guarantee in an amount not to exceed $50.0 million in the aggregate. As of December 31, 2022, a total of $18.7 million of letters of credit/guarantee were outstanding under this facility. Covenants The Credit Agreement and the Indentures include customary representations, warranties, covenants 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. We were in compliance with all financial covenants in our Credit Agreement at December 31, 2022. Debt Maturities The following is a summary of aggregate maturities of long-term debt for each of the next five years and thereafter: (in millions) 2023 $ 508.2 2024 0.3 2025 400.3 2026 0.4 2027 0.4 Thereafter 750.0 $ 1,659.6 |
Leases
Leases | 12 Months Ended |
Dec. 31, 2022 | |
Leases | |
Leases | Note 10. Leases Our metals service center leases are comprised of processing and distribution facilities, equipment, trucks and trailers, ground leases and other leased spaces, such as depots, sales offices, storage and data centers. We also lease various office spaces. Our leases of facilities and other spaces expire at various times through 2045 and our ground leases expire at various times through 2068. Nearly all of our leases are operating leases; we have recognized finance right-of-use assets and obligations The following is a summary of our lease cost: Year Ended December 31, 2022 2021 2020 (in millions) Operating lease cost $ 91.4 $ 82.2 $ 82.1 Our operating lease costs include payments to various related parties that are not executive officers of the Company, in the amounts of $0.2 million, $1.9 million and $1.9 million in 2022, 2021 and 2020, respectively. These related party leases are for buildings leased to certain of the companies we have acquired and expire through 2023. Supplemental cash flow and balance sheet information is presented below: Year Ended December 31, 2022 2021 2020 (in millions) Supplemental cash flow information: Cash payments for operating leases $ 86.9 $ 81.7 $ 81.7 Right-of-use assets obtained in exchange for operating lease obligations $ 52.4 $ 46.8 $ 58.8 December 31, December 31, 2022 2021 Other lease information: Weighted average remaining lease term—operating leases 6.6 years 5.8 years Weighted average discount rate—operating leases 3.8% 3.3% Maturities of operating lease liabilities as of December 31, 2022 are as follows: (in millions) 2023 $ 59.1 2024 48.9 2025 36.3 2026 24.8 2027 17.5 Thereafter 64.8 Total operating lease payments 251.4 Less: imputed interest (33.7) Total operating lease liabilities $ 217.7 |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2022 | |
Income Taxes | |
Income Taxes | Note 11. Income Taxes Reliance and its subsidiaries file numerous consolidated and separate income tax returns in the United States federal jurisdiction and in many state and foreign jurisdictions. We are no longer subject to U.S. federal tax examinations for years before 2019 and state and local tax examinations before 2018. Significant components of the provision for income taxes attributable to continuing operations were as follows: Year Ended December 31, 2022 2021 2020 (in millions) Current: Federal $ 418.9 $ 362.9 $ 77.6 State 112.9 98.0 24.9 Foreign 61.1 28.6 17.0 592.9 489.5 119.5 Deferred: Federal (3.7) (20.2) (7.1) State (2.0) (4.0) 0.3 Foreign (1.0) 0.4 (6.9) (6.7) (23.8) (13.7) $ 586.2 $ 465.7 $ 105.8 Components of U.S. and international income before income taxes were as follows: Year Ended December 31, 2022 2021 2020 (in millions) U.S. $ 2,199.2 $ 1,778.5 $ 465.9 International 231.2 104.6 12.3 Income before income taxes $ 2,430.4 $ 1,883.1 $ 478.2 The reconciliation of income tax at the U.S. federal statutory tax rate to income tax expense is as follows: Year Ended December 31, 2022 2021 2020 Income tax at U.S. federal statutory tax rate 21.0 % 21.0 % 21.0 % State income tax, net of federal tax effect 3.5 3.8 3.6 Foreign earnings taxed at higher rates 0.5 0.4 1.0 Net effect of life insurance policies (0.6) (0.8) (2.9) Net effect of changes in unrecognized tax benefits — 0.1 (0.3) Stock-based compensation — 0.3 0.8 Other, net (0.3) (0.1) (1.1) Effective tax rate 24.1 % 24.7 % 22.1 % Significant components of our deferred tax assets and liabilities are as follows: December 31, 2022 2021 (in millions) Deferred tax assets: Allowance for doubtful accounts $ 6.6 $ 6.6 Inventory costs capitalized for tax purposes 12.0 12.9 LIFO inventories 0.7 — Accrued expenses not currently deductible for tax 29.2 36.9 Stock-based compensation 11.1 10.1 Net operating loss carryforwards 3.2 3.9 Tax credits carryforwards 0.7 0.9 Total deferred tax assets 63.5 71.3 Deferred tax liabilities: Property, plant and equipment, net (196.8) (183.1) Goodwill and other intangible assets (340.9) (342.0) LIFO inventories — (25.0) Other (2.4) (6.0) Total deferred tax liabilities (540.1) (556.1) Net deferred tax liabilities $ (476.6) $ (484.8) As of December 31, 2022, we had $3.6 million of state and $0.4 million of acquired federal net operating loss carryforwards (“NOLs”), which are available to offset future income taxes. The state and federal NOLs expire in various years from 2023 through 2042, if not utilized. We believe that it is more likely than not that we will be able to realize these NOLs within their respective carryforward periods. The Company believes it is more likely than not that it will generate sufficient future taxable income to realize its deferred tax assets. Unrecognized Tax Benefits We are under audit by various state jurisdictions for years 2017 through 2019, but do not anticipate any material adjustments from these examinations. Reconciliation of the beginning and ending balances of the total amounts of unrecognized tax benefits is as follows: Year Ended December 31, 2022 2021 2020 (in millions) Unrecognized tax benefits at January 1 $ 1.9 $ 1.0 $ 2.2 Increases in tax positions for prior years 0.8 — — Increases in tax positions for current year — 1.0 — Settlements (0.8) — (1.1) Lapse of statute of limitations (0.5) (0.1) (0.1) Unrecognized tax benefits at December 31 $ 1.4 $ 1.9 $ 1.0 As of December 31, 2022, $1.4 million of unrecognized tax benefits would impact the effective tax rate if recognized. Accrued interest and penalties, net of applicable tax effect, related to uncertain tax positions were $0.3 million and $0.7 million as of December 31, 2022 and 2021, respectively. Although the timing, settlement or closure of audits is not certain, we do not anticipate our unrecognized tax benefits will increase or decrease significantly over the next twelve months. |
Stock-Based Compensation Plans
Stock-Based Compensation Plans | 12 Months Ended |
Dec. 31, 2022 | |
Stock-Based Compensation Plans | |
Stock-Based Compensation Plans | Note 12. Stock-Based Compensation Plans We make annual grants of long-term equity incentive awards to officers and key employees under our Second Amended and Restated 2015 Incentive Award Plan in the forms of service-based restricted stock units (“RSUs”) and performance-based restricted stock units (“PSUs”) that each have approximately 3-year Stock Awards In 2022, 2021 and 2020, we granted 6,136; 6,248; and 12,807 fully vested stock awards, respectively, to the non-employee members of the Board of Directors. The fair values of the stock awards granted in 2022, 2021 and 2020, were $182.41 per share, $166.39 per share and $91.30 per share, respectively, determined based on the closing price of our common stock on the respective grant dates. Restricted Stock Units In 2022, 2021 and 2020, we granted to key employees equity awards consisting of RSUs and PSUs in aggregate amounts of 305,249 units, 318,495 units and 540,547 units, respectively. Each RSU and PSU includes a service-based condition and consists of a right to receive shares of our common stock and dividend equivalent rights, subject to forfeiture, equal to the accrued cash or stock dividends where the record date for such dividends is after the grant date but before the award is settled. In 2022, 2021 and 2020, we granted 192,798, 191,139, and 330,144 RSUs, respectively, that provide the right to receive one share of our common stock and cliff vest at December 1, 2024 December 1, 2023 December 31, 2024 December 31, 2023 In 2022, 2021 and 2020, we made payments of $39.7 million, $21.2 million and $23.1 million, respectively, to tax authorities on our employees’ behalf for shares withheld related to net share settlements. A summary of the status of our unvested RSUs and PSUs as of December 31, 2022 and changes during the year then ended is as follows: Weighted Average RSU and PSU Grant Date Aggregate Units Fair Value Unvested at January 1, 2022 831,597 $ 105.12 Granted 305,249 187.31 Vested (518,743) 84.82 Cancelled or forfeited (36,091) 132.95 Unvested at December 31, 2022 582,012 $ 164.60 The fair values as of the respective vesting dates of RSUs and PSUs vested during 2022, 2021 and 2020 were $147.2 million, $126.0 million and $54.0 million, respectively. PSUs totaling 196,944 units that vested on December 31, 2022 were settled in February 2023 through the issuance of 393,888 equivalent shares of our common stock. Unrecognized Compensation Cost and Tax Benefits As of December 31, 2022, there was $73.9 million of total unrecognized compensation cost related to unvested RSUs and PSUs in an aggregate amount of 582,012 units that are expected to be settled through the issuance of 802,184 shares of our common stock. The unrecognized compensation cost is expected to be recognized over a weighted average period of 1.7 years. The tax benefit realized from our stock-based compensation plans in 2022, 2021 and 2020 was $8.0 million, $6.8 million and $6.1 million, respectively. |
Employee Benefits
Employee Benefits | 12 Months Ended |
Dec. 31, 2022 | |
Employee Benefits | |
Employee Benefits | Note 13. Employee Benefits Defined Contribution Plans Effective in 1998, the Reliance Steel & Aluminum Co. Master 401(k) Plan (the “Master 401(k) Plan”) was established, which combined several of the various 401(k) and profit-sharing plans of the Company and its subsidiaries into one plan. Salaried and certain hourly employees of the Company and its participating subsidiaries are covered under the Master 401(k) Plan. Eligibility occurs after 30 days of service and the Company contribution vests at 25% per year. Our Other Defined Contribution Plans include the Precision Strip Retirement and Savings Plan and plans at certain foreign subsidiaries that have not merged their plans into the Master 401(k) Plan as of December 31, 2022. We also sponsor the Reliance Steel & Aluminum Co. Employee Stock Ownership Plan, a tax-qualified noncontributory employee stock ownership plan, for certain salaried and hourly employees of the Company. The plan is closed to new enrollees and the Company is not currently making annual contributions to the plan. Supplemental Executive Retirement Plans Effective January 1996, we adopted the Supplemental Executive Retirement Plan (“Reliance SERP”), which is a nonqualified pension plan that provides postretirement pension benefits to certain key officers of the Company. The Reliance SERP is administered by the Compensation Committee of the Board. Benefits are based upon the employees’ earnings. We recognized settlement losses of $2.3 million and $6.7 million in the years ended December 31, 2022 and 2020, respectively, related to the payment of benefits under the Reliance SERP. Life insurance policies were purchased for most individuals covered by the Reliance SERP and held within a rabbi trust. See Note 8—“Cash Surrender Value of Life Insurance Policies, net” Deferred Compensation Plan In December 2008, the Reliance Deferred Compensation Plan (the “DCP”) was established for certain officers and key employees of the Company. Account balances from various compensation plans of subsidiaries were contributed and consolidated into this new deferred compensation plan. Plan participants may contribute a portion of their eligible compensation to the plan and Reliance currently makes contributions to the plan for certain participants. During 2021, we established a rabbi trust to fund our obligations under the DCP. The rabbi trust is an irrevocable grantor trust to which we may contribute assets for the purpose of funding the DCP. Although we may not use the assets of the rabbi trust for any purpose other than meeting our obligations under the DCP, the assets of the rabbi trust remain subject to the claims of our creditors. The aggregate fair value of the marketable securities held by the rabbi trust as of December 31, 2022 and 2021 were $41.2 million and $40.9 million, respectively, and the amount of our obligations to the participants under the DCP on those dates were also $41.2 million and $40.9 million, respectively. The rabbi trust assets and our liability under the DCP are included in the Other long-term assets and Other long-term liabilities captions of our consolidated balance sheets. The Company expects to contribute $2.0 million to the plan during 2023. Multiemployer Plans Certain of our union employees participate in plans collectively bargained and maintained by multiple employers and a labor union. We do not recognize on our balance sheet any amounts relating to these plans. For 2022, 2021 and 2020 our contributions to these plans were $5.4 million, $4.8 million and $5.3 million, respectively. Some of the plans we participate in are in endangered, critical or critical and declining status and have adopted rehabilitation plans. If we were to withdraw our participation from these plans, we would be required to recognize a liability on our balance sheet and the amount could be significant. Defined Benefit Plans Our wholly owned subsidiary, EMJ, maintains a qualified defined benefit pension plan (the “Defined Benefit Plan”) for certain union employees. The plan generally provides benefits of stated amounts for each year of service or provides benefits based on the participant’s hourly wage rate and years of service. The plan permits the sponsor, at any time, to amend or terminate the plan. We also maintained frozen defined benefit plans (together with the Defined Benefit Plan, the “Defined Benefit Plans”), which were merged into a single plan that was terminated during 2020, which resulted in our recognition of a $12.7 million settlement loss. We use a December 31 measurement date for our plans. The following is a summary of the status of the funding of the SERPs and Defined Benefit Plan: SERPs Defined Benefit Plan 2022 2021 2022 2021 (in millions) (in millions) Change in benefit obligation: Benefit obligation at beginning of year $ 36.4 $ 37.5 $ 74.5 $ 76.3 Service cost 0.4 1.0 2.0 2.2 Interest cost 0.7 0.6 2.0 1.8 Actuarial gain (1) (5.6) (1.8) (21.0) (3.6) Benefits paid (0.8) (0.9) (2.5) (2.2) Plan settlement (12.3) — — — Benefit obligation at end of year $ 18.8 $ 36.4 $ 55.0 $ 74.5 Change in plan assets: Fair value of plan assets at beginning of year N/A N/A $ 70.9 $ 63.9 Actual return on plan assets N/A N/A (11.7) 9.2 Benefits paid N/A N/A (2.5) (2.2) Fair value of plan assets at end of year N/A N/A $ 56.7 $ 70.9 Funded status: Funded status of the plans $ (18.8) $ (36.4) $ 1.7 $ (3.6) Items not yet recognized as component of net periodic pension expense: Unrecognized net actuarial losses $ 1.9 $ 10.5 $ 0.5 $ 5.6 Unamortized prior service cost — — 2.8 3.4 $ 1.9 $ 10.5 $ 3.3 $ 9.0 (1) Actuarial gains in 2022 and 2021 were primarily due to increases in the discount rate used to measure the obligations. As of December 31, 2022 and 2021, the following amounts were recognized on the balance sheet: SERPs Defined Benefit Plan 2022 2021 2022 2021 (in millions) (in millions) Amounts recognized in the statement of financial position: Noncurrent assets $ — $ — $ 1.7 $ — Current liabilities (0.8) (12.9) — — Noncurrent liabilities (18.0) (23.5) — (3.6) Accumulated other comprehensive loss 1.9 10.5 3.3 9.0 Net amount recognized $ (16.9) $ (25.9) $ 5.0 $ 5.4 The accumulated benefit obligation for the SERPs was $17.1 million and $32.9 million as of December 31, 2022 and 2021, respectively. At December 31, 2022, the fair value of the Defined Benefit Plan assets of $56.7 million exceeded the accumulated benefit obligation of $55.0 million. At December 31, 2021, the accumulated benefit obligation of the Defined Benefit Plan of $74.5 million exceeded the fair value of plan assets of $70.9 million. Details of net periodic benefit cost related to the SERPs and Defined Benefit Plans are presented below: SERPs Defined Benefit Plans Year Ended December 31, Year Ended December 31, 2022 2021 2020 2022 2021 2020 (in millions) (in millions) Service cost $ 0.4 $ 1.0 $ 0.9 $ 2.0 $ 2.2 $ 2.1 Interest cost 0.7 0.6 1.0 2.0 1.8 2.6 Expected return on plan assets — — — (4.2) (3.9) (4.4) Settlement losses 2.3 — 6.7 — — 12.7 Prior service cost — — — 0.5 0.6 0.6 Amortization of net loss 0.6 1.8 1.9 — 0.8 1.1 $ 4.0 $ 3.4 $ 10.5 $ 0.3 $ 1.5 $ 14.7 Net periodic benefit cost related to the SERPs and the Defined Benefit Plans is presented in our consolidated statements of income, as summarized below: SERPs Defined Benefit Plans Year Ended December 31, Year Ended December 31, 2022 2021 2020 2022 2021 2020 (in millions) (in millions) Amounts recognized in the statement of income: Warehouse, delivery, selling, general and administrative expense $ 0.4 $ 1.0 $ 0.9 $ 2.0 $ 2.2 $ 2.1 Other expense (income), net 3.6 2.4 9.6 (1.7) (0.7) 12.6 $ 4.0 $ 3.4 $ 10.5 $ 0.3 $ 1.5 $ 14.7 Assumptions used to determine net periodic benefit cost are detailed below: SERPs Defined Benefit Plans Year Ended December 31, Year Ended December 31, 2022 2021 2020 2022 2021 2020 Weighted average assumptions to determine net cost: Discount rate 2.17 % 1.64 % 2.63 % 2.70 % 2.40 % 2.85 % Expected long-term rate of return on plan assets N/A N/A N/A 6.00 % 6.25 % 6.25 % Rate of compensation increase 6.00 % 6.00 % 6.00 % N/A N/A N/A Assumptions used to determine the benefit obligation are detailed below: SERPs Defined Benefit Plan December 31, December 31, 2022 2021 2022 2021 Weighted average assumptions to determine benefit obligations: Discount rate 4.51 % 2.16 % 5.00 % 2.70 % Expected long-term rate of return on plan assets N/A N/A 6.00 % 6.25 % Rate of compensation increase 6.00 % 6.00 % N/A N/A Employer contributions of $0.8 million are expected during 2023 to the SERPs and none for the Defined Benefit Plan. Plan Assets and Investment Policy The weighted-average asset allocations of our Defined Benefit Plan by asset category were as follows: December 31, 2022 2021 Plan assets: Equity securities 58 % 66 % Debt securities 38 32 Cash and cash equivalents 4 2 Total 100 % 100 % Plan assets are invested in various asset classes that are expected to produce a sufficient level of diversification and investment return over the long term. The investment goal is a return on assets that is at least equal to the assumed actuarial rate of return over the long-term within reasonable and prudent levels of risk. We establish our estimated long-term return on plan assets assumption considering various factors including the targeted asset allocation percentages, historic returns and expected future returns. The fair value measurements of the investments held by our Defined Benefit Plan fall within the following levels of the fair value hierarchy as of December 31, 2022 and 2021: Level 1 Level 2 Level 3 Total (in millions) December 31, 2022 Common stock (1) $ 31.4 $ — $ — $ 31.4 U.S. government, state and agency — 6.0 — 6.0 Corporate debt securities (2) — 4.6 — 4.6 Mutual funds (3) 12.6 — — 12.6 Interest bearing cash 2.1 — — 2.1 Total investments at fair value $ 46.1 $ 10.6 $ — $ 56.7 December 31, 2021 Common stock (1) $ 39.0 $ — $ — $ 39.0 U.S. government, state and agency — 5.1 — 5.1 Corporate debt securities (2) — 4.9 — 4.9 Mutual funds (3) 20.6 — — 20.6 Interest bearing cash 1.3 — — 1.3 Total investments at fair value $ 60.9 $ 10.0 $ — $ 70.9 (1) Comprised primarily of securities of large domestic and foreign companies. Valued at the closing price reported on the active market on which the individual securities are traded on national exchanges. (2) Valued using pricing models maximizing the use of observable inputs for similar securities. This includes basing values on a combination of inputs, including benchmark yields, reported trades, broker/dealer quotes, issuer spreads, two-sided markets, benchmark securities, bids, offers and reference data. (3) Mutual funds held are registered with the United States Securities and Exchange Commission. These funds are required to publish their daily net asset value (NAV) and to transact at that price. The mutual funds held are deemed to be actively traded. Summary Disclosures—SERPs and Defined Benefit Plan The following is a summary of benefit payments under the SERPs and the Defined Benefit Plan, which reflect expected future employee service, as appropriate, expected to be paid in the periods indicated: Defined SERPs Benefit Plan (in millions) 2023 $ 0.8 $ 2.6 2024 0.8 2.7 2025 0.8 2.9 2026 0.8 3.1 2027 1.2 3.2 2028-2032 20.7 18.0 Contributions to Reliance Sponsored Retirement Plans Our expense for Reliance-sponsored retirement plans was as follows: Year Ended December 31, 2022 2021 2020 (in millions) Master 401(k) Plan $ 28.1 $ 25.6 $ 21.2 Precision Strip Retirement and Savings Plan 9.2 8.0 5.2 Supplemental Executive Retirement Plans 4.0 3.4 10.5 Deferred Compensation Plan 2.0 2.5 (0.3) Other Defined Contribution Plans 2.0 2.0 1.7 Defined Benefit Plans 0.3 1.5 14.7 $ 45.6 $ 43.0 $ 53.0 |
Equity
Equity | 12 Months Ended |
Dec. 31, 2022 | |
Equity | |
Equity | Note 14. Equity Common Stock We have paid regular quarterly cash dividends on our common stock for 63 consecutive years. Our Board of Directors increased the quarterly dividend to $0.625 per share in February 2020 from $0.55 per share, to $0.6875 per share in February 2021, to $0.875 per share in February 2022, and to $1.00 per share in February 2023. The holders of Reliance common stock are entitled to one vote per share on each matter submitted to a vote of stockholders. Shares Outstanding Issued and outstanding common shares were as follows: Year Ended December 31, 2022 2021 2020 (in thousands) Issued and outstanding common shares, beginning balances 61,806 63,600 66,854 Issued to settle RSUs and PSUs, net of withheld shares 506 313 414 Issued for stock option exercises — — 6 Repurchased (3,525) (2,107) (3,674) Issued and outstanding common shares, ending balances 58,787 61,806 63,600 Share Repurchases On July 26, 2022, our Board of Directors amended our share repurchase program to increase the remaining repurchase authorization to $1.0 billion. We repurchase shares through open market purchases and transactions structured through investment banking institutions under plans relying on Rule 10b5-1 and/or Rule 10b-18 under the Exchange Act. Our share repurchase activity for the past three years consisted of the following: Average Cost Shares Per Share Amount (in thousands) (in millions) 2022 3,525 $ 178.81 $ 630.3 2021 2,107 $ 153.55 $ 323.5 2020 3,674 $ 91.80 $ 337.3 Preferred Stock We are authorized to issue 5,000,000 shares of preferred stock, par value $0.001 per share. No shares of our preferred stock are issued and outstanding Accumulated Other Comprehensive Loss Accumulated other comprehensive loss included the following: Pension and Foreign Currency Postretirement Benefit Accumulated Other Translation Plan Adjustments, Comprehensive Loss Net of Tax Loss (in millions) Balance as of January 1, 2022 $ (55.2) $ (13.7) $ (68.9) Current-year change (28.8) 11.4 (17.4) Balance as of December 31, 2022 $ (84.0) $ (2.3) $ (86.3) Foreign currency translation adjustments have not been adjusted for income taxes. Pension and postretirement benefit plan adjustments are amortized over service periods and reflected in the amortization of net loss component of our net periodic benefit cost or are otherwise recognized as a loss as a result of plan settlements. Pension and postretirement benefit adjustments are net of taxes of $1.3 million and $3.3 million as of December 31, 2022 and 2021, respectively. The income tax effects are released from accumulated other comprehensive loss and included in our income tax provision as obligations under our pension and postretirement plans are settled. In 2022, $0.3 million of income tax effects were released related to the partial settlement of the Reliance SERP. See Note 13—“Employee Benefits” |
Other Expense (Income), net
Other Expense (Income), net | 12 Months Ended |
Dec. 31, 2022 | |
Other Expense (Income), net. | |
Other Expense (Income), net | Note 15. Other Expense (Income), net Significant components of Other expense, net are as follows: Year Ended December 31, 2022 2021 2020 (in millions) Investment income from life insurance policies $ (85.2) $ (84.6) $ (79.3) Interest expense on life insurance policy loans 91.6 85.5 79.4 Life insurance policy cost of insurance 15.7 14.4 13.4 Income from life insurance policy redemptions (6.6) (6.2) (4.6) Foreign currency transaction losses 6.2 4.0 2.3 Net periodic benefit cost—settlement losses 2.3 — 19.4 Net periodic benefit cost—components other than service cost and settlement loss (0.4) 1.7 2.8 Loss (income) on deferred compensation plan assets 6.9 (4.1) (4.3) Interest income (9.3) (1.1) (0.9) All other, net (7.0) (6.5) (3.5) $ 14.2 $ 3.1 $ 24.7 |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2022 | |
Commitments and Contingencies. | |
Commitments and Contingencies | Note 16. Commitments and Contingencies Purchase Commitments As of December 31, 2022, we had commitments to purchase minimum quantities of certain metal products, which we entered into to secure material for corresponding long-term sales commitments we have entered into with our customers. The total amount of the minimum commitments based on current pricing is estimated at approximately $320.1 million, with amounts in 2023, 2024 and thereafter being $179.1 million, $44.9 million and $96.1 million, respectively. Collective Bargaining Agreements As of December 31, 2022, approximately 1,900, or 13%, of our total employees were covered by 61 collective bargaining agreements at 52 of our different locations, which expire at various times over the next five years. Approximately 500 of our employees are covered by 23 different collective bargaining agreements that will expire during 2023. Environmental Contingencies We are subject to extensive and changing federal, state, local and foreign laws and regulations designed to protect the environment, including those relating to the use, handling, storage, discharge and disposal of hazardous substances and the remediation of environmental contamination. Our operations use minimal amounts of such substances. We believe we are in material compliance with environmental laws and regulations; however, we are from time to time involved in administrative and judicial proceedings and inquiries relating to environmental matters. Some of our owned or leased properties are located in industrial areas with histories of heavy industrial use. We may incur some environmental liabilities because of the location of these properties. In addition, we are currently involved with an environmental remediation project related to activities at former manufacturing operations of EMJ, our wholly owned subsidiary, that 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. These actions generally 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 impact on our consolidated financial condition, results of operations or cash flows. We maintain general liability insurance against risks arising in the ordinary course of business. Risks and Uncertainties W Part I, Item 1A “Risk Factors” |
Earnings Per Share
Earnings Per Share | 12 Months Ended |
Dec. 31, 2022 | |
Earnings Per Share | |
Earnings Per Share | Note 17. Earnings Per Share The following table sets forth the computation of basic and diluted earnings per share: Year Ended December 31, 2022 2021 2020 (in millions, except share amounts which are reflected in thousands and per share amounts) Numerator: Net income attributable to Reliance $ 1,840.1 $ 1,413.0 $ 369.1 Denominator: Weighted average shares outstanding 60,559 63,217 64,328 Dilutive effect of stock-based awards 936 1,110 935 Weighted average diluted shares outstanding 61,495 64,327 65,263 Earnings per share attributable to Reliance stockholders: Basic $ 30.39 $ 22.35 $ 5.74 Diluted $ 29.92 $ 21.97 $ 5.66 The computations of earnings per share for 2022, 2021 and 2020 do not include 83,857 , 116,206 and 183,508 weighted average shares, respectively, in respect of outstanding RSUs and PSUs, because their |
Segment Information
Segment Information | 12 Months Ended |
Dec. 31, 2022 | |
Segment Information | |
Segment Information | Note 18. Segment Information We have one operating and reportable segment —metals service centers 2022 2021 2020 Carbon steel 54 % 58 % 51 % Stainless steel 17 16 16 Aluminum 15 14 19 Alloy 4 4 5 Toll processing and logistics 3 3 4 Copper and brass 2 1 1 Other 5 4 4 Total 100 % 100 % 100 % The following table summarizes consolidated financial information of our U.S. and foreign operations: United States Foreign Countries Total (in millions) Year Ended December 31, 2022: Net sales $ 15,978.6 $ 1,046.4 $ 17,025.0 Long-lived assets 5,051.9 391.4 5,443.3 Year Ended December 31, 2021: Net sales 13,371.7 721.6 14,093.3 Long-lived assets 4,971.2 404.7 5,375.9 Year Ended December 31, 2020: Net sales 8,180.7 631.2 8,811.9 Long-lived assets 4,709.1 284.9 4,994.0 |
Impairment and Restructuring Ch
Impairment and Restructuring Charges | 12 Months Ended |
Dec. 31, 2022 | |
Impairment and Restructuring Charges | |
Impairment and Restructuring Charges | Note 19. Impairment and Restructuring Charges Our impairment and restructuring charges consisted of the following: Year Ended December 31, 2022 2021 2020 (in millions) Intangible assets, net $ — $ 4.7 $ 98.5 Property, plant and equipment — — 9.3 Operating lease right-of-use assets — — 0.2 Total impairment charges — 4.7 108.0 Restructuring––cost of sales — — 38.2 Restructuring––SG&A 1.4 0.1 11.6 Total impairment and restructuring charges $ 1.4 $ 4.8 $ 157.8 We recorded impairment and restructuring charges of $157.8 million in 2020, which was substantially comprised of a $137.5 million impairment and restructuring charge recognized during the first quarter of 2020 mainly due to our reduced long-term outlook for our businesses serving the energy (oil and natural gas) market and to a lesser extent charges related to the closure of certain locations where our outlook had turned negative based on the impacts from COVID-19 and our anticipated losses on the disposition of property, plant and equipment, and inventories. The measurement of intangible assets at fair value in 2021 and 2020 was determined using discounted cash flow techniques. The use of discounted cash flow models requires judgment and the use of inputs by management that are unobservable, including revenue forecasts, discount rates and long-term growth rates. Unobservable inputs also include the Company’s expectations of the assumptions market participants would use in pricing the eventual recovery of the oil and natural gas and aerospace industries based on the best available information in the circumstances at that time. |
SCHEDULE II - VALUATION AND QUA
SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS | 12 Months Ended |
Dec. 31, 2022 | |
SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS | |
SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS | RELIANCE STEEL & ALUMINUM CO. SCHEDULE II—VALUATION AND QUALIFYING ACCOUNT S (in millions) Additions Amounts Balance at Charged to Charged to Balance at Beginning Costs and Other End of of Year Expenses Deductions (1) Accounts Year Year Ended December 31, 2022: Allowance for credit losses $ 26.7 $ 3.4 $ 4.0 $ — $ 26.1 Year Ended December 31, 2021: Allowance for credit losses $ 19.0 $ 9.8 $ 2.8 $ 0.7 $ 26.7 Year Ended December 31, 2020: Allowance for credit losses $ 17.8 $ 5.8 $ 4.6 $ — $ 19.0 (1) Uncollectible accounts written off. See accompanying report of independent registered public accounting firm. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2022 | |
Summary of Significant Accounting Policies | |
Principles of Consolidation | Principles of Consolidation The accompanying consolidated financial statements include the accounts of Reliance Steel & Aluminum Co. and its subsidiaries (collectively referred to as “Reliance”, “the Company”, “we”, “our” or “us”). 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 interests in our consolidated subsidiaries held by others are reflected as noncontrolling interests. Our investments in unconsolidated subsidiaries are recorded under the equity method of accounting. |
Business | Business As a global diversified metal solutions provider, we operate a network of approximately 315 locations in 40 states and in 12 foreign countries (Belgium, Canada, China, France, India, Malaysia, Mexico, Singapore, South Korea, Turkey, the United Arab Emirates and the United Kingdom) that provides value-added metals processing services and distributes a full line of more than 100,000 metal products. |
Reclassification | Reclassification The accompanying consolidated balance sheet as of December 31, 2021 includes a reclassification of $43.2 million of deferred compensation plan liabilities from Long-term retirement benefits to Other long-term liabilities |
Accounting Estimates | Accounting Estimates The preparation of financial statements in conformity with U.S. generally accepted accounting principles (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, such as allowances for credit losses, net realizable values of inventories, fair values and/or impairment of goodwill and other indefinite-lived intangible assets, long-lived assets, the amount of unrecognized tax benefits and other contingencies, and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. The Company bases its estimates on historical experience and on various other assumptions that the Company believes to be reasonable under the circumstances. Actual results could differ from those estimates. |
Accounts Receivable and Concentrations of Credit Risk | Accounts Receivable and Concentrations of Credit Risk Trade receivables are typically non-interest bearing and are recorded at amortized cost. Sales to our recurring customers are generally made on open account terms while sales to occasional customers may be made on a collect on delivery basis. Past due status of customer accounts is determined based on how recently payments have been received in relation to payment terms granted. Credit is generally extended based upon an evaluation of each customer’s financial condition, with terms consistent in the industry and no collateral is required. The allowance for credit losses reflects the expected losses on our trade receivables and is determined based on customer-specific facts and the consideration of historical loss information, current conditions and reasonable and supportable forecasts using a loss-rate approach. Amounts are written-off against the allowance in the period we determine that the receivable is uncollectible. Concentrations of credit risk with respect to trade receivables are limited due to the geographically diverse customer base, with limited exposure to any single customer account, and various industries into which our products are sold. We do not consider ourselves to have any significant concentrations of credit risk. |
Inventories | Inventories The majority of our inventory is valued using the last-in, first-out (“LIFO”) method, which is not in excess of market. Under this method, older costs are included in inventory, which may be higher or lower than current costs. This method of valuation is subject to year-to-year fluctuations in cost of material sold, which is influenced by the inflation or deflation existing within the metal wholesaling industry as well as fluctuations in our product mix and on-hand inventory levels. |
Fair Values of Financial Instruments | Fair Values of Financial Instruments Fair values of cash and cash equivalents, accounts receivable, accounts payable, accrued expenses and other current liabilities, and current maturities of operating lease liabilities approximate carrying values due to the short period of time to maturity. Fair values of long-term debt, which have been determined based on borrowing rates currently available to us or to other companies with comparable credit ratings, for loans with similar terms or maturity, approximate the carrying amounts in the consolidated financial statements, with the exception of our publicly traded senior unsecured notes with an aggregate face value of $1.65 billion as of December 31, 2022 and 2021. The aggregate fair value of these senior unsecured notes based on quoted market prices was $1.53 billion and $1.75 billion at December 31, 2022 and 2021, respectively, compared to their aggregate carrying value of $1.64 billion. The estimated fair values of our senior unsecured notes are based on Level 2 inputs, including benchmark yields, reported trades and broker/dealer quotes. Fair values of our other financial instruments, which include assets held within rabbi trusts, are comprised of assets that are generally based on quoted market prices for identical instruments that trade in active markets. |
Cash Equivalents | Cash Equivalents We consider all highly liquid instruments with an original maturity of three months or less when purchased to be cash equivalents. We maintain cash and cash equivalents with high credit quality financial institutions. The Company, by policy, limits the amount of credit exposure to any one financial institution. |
Goodwill and Other Indefinite-Lived Intangible Assets | Goodwill and Other Indefinite-Lived Intangible Assets Goodwill is the excess of purchase price over the fair value of identified assets and liabilities of businesses acquired. Other indefinite-lived intangible assets include amounts allocated to the trade names of businesses acquired. Goodwill and other indefinite-lived intangible assets are not amortized but are tested for impairment at least annually. We test for impairment of goodwill and intangible assets deemed to have indefinite lives annually and, between annual tests, whenever significant events or changes occur based on an assessment of qualitative factors to determine if it is more likely than not that the fair value is less than the carrying value. We have one operating segment and one reporting unit for goodwill impairment purposes. We calculate the fair value of the reporting unit using our market capitalization or the discounted cash flow method, as necessary, and compare the fair value to the carrying value of the reporting unit to determine if impairment exists. We perform our annual impairment evaluations of goodwill and other indefinite-lived intangible assets on November 1 of each year. No impairment of goodwill was determined to exist in any of the years presented. We recognized impairment losses of $4.7 million and $67.8 million related to our other intangible assets with indefinite lives in 2021 and 2020. No impairment losses were recognized related to our other intangible assets with indefinite lives in 2022. See Note 19—“Impairment and Restructuring Charges” |
Long-Lived Assets | Long-Lived Assets Property, plant and equipment is recorded at cost (or at fair value for assets acquired in connection with business combinations) and the provision for depreciation of these assets is generally computed on the straight-line method at rates designed to distribute the cost of assets over the useful lives, estimated as follows: buildings, including leasehold improvements, over five three Intangible assets with finite useful lives are amortized over their useful lives. We periodically review the recoverability of our property, plant and equipment and intangible assets subject to amortization whenever events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable. We didn’t recognize any impairment losses for long-lived assets in 2022 and 2021. We recognized $9.3 million of impairment Note 19—“Impairment and Restructuring Charges” |
Leases | Leases We determine if an arrangement is a lease at inception. Our lease agreements generally contain only lease components. Our lease payments are generally fixed with certain leases containing variable payments related to Consumer Price Index (“CPI”) annual adjustments. Right-of-use assets and lease liabilities are recognized on the balance sheet at the present value of the future lease payments at the lease commencement date. Certain of our lease terms include periods under renewal options when it is reasonably certain that we will exercise that option. We generally include optional renewal periods when determining our lease terms and future lease payments. The interest rate used to determine the present value of future lease payments is our incremental borrowing rate that is estimated to approximate the interest rate on a collateralized basis with similar terms and payments. Operating lease cost is recognized on a straight-line basis over the lease term. |
Revenue Recognition | 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. Sales and value-added taxes collected from customers are excluded from our reported sales. 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 is not significant as of December 31, 2022, 2021 and 2020. Metal Sales We have minimal long-term contract sales with our customers as we primarily transact in the spot market under fixed price sales orders. The majority of our metal product sales orders generally have only one performance obligation: sale of processed or unprocessed metal product. 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. In 2022, 2021 and 2020, shipping and handling costs included in Warehouse, delivery, selling, general and administrative (“SG&A”) expenses were $509.7 million, $424.6 million and $357.4 million, respectively. 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 and storage services for metal we toll process. Revenue for these services is recognized over time as the toll processing or logistics services are performed. The toll processing 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. 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. The number of shipping days in each quarter also has an impact on our quarterly sales and profitability. We cannot predict whether period-to-period fluctuations will be consistent with historical patterns. Results of any one or more quarters are therefore not necessarily indicative of annual results. |
Stock-Based Compensation | Stock-Based Compensation All of our stock-based compensation plans are considered equity plans. The fair value of stock awards and restricted stock units is determined based on the fair value of our common stock on the grant date. The fair value of stock awards and restricted stock units is expensed on a straight-line basis over their respective vesting periods, net of forfeitures when they occur. Stock-based compensation expense was $65.3 million, $70.8 million and $42.2 million in 2022, 2021 and 2020, respectively, and is included in the SG&A caption of our consolidated statements of income. |
Environmental Remediation Costs | Environmental Remediation Costs We accrue for losses associated with environmental remediation obligations when such losses are probable and reasonably estimable. Accruals for estimated losses from environmental remediation obligations generally are recognized no later than completion of the remediation feasibility study. Such accruals are adjusted as further information develops or circumstances change. Recoveries of environmental remediation costs from insurance policies and other parties are recorded as assets when their receipt is deemed probable. We are not aware of any environmental remediation obligations that would materially affect our operations, financial position or cash flows. See Note 16—“Commitments and Contingencies” |
Income Taxes | Income Taxes We file a consolidated U.S. federal income tax return with our wholly owned domestic subsidiaries. Deferred tax assets and liabilities are recognized for the expected future tax consequences of temporary differences between the financial reporting and tax reporting bases of assets and liabilities using the enacted tax rates expected to be in effect when such differences are realized or settled. The effect on deferred taxes from a change in tax rates is recognized in income in the period that includes the enactment date of the change. The provision for income taxes reflects the taxes to be paid for the period and the change during the period in the deferred tax assets and liabilities. We evaluate on a quarterly basis whether, based on all available evidence, it is probable that the deferred income tax assets are realizable. Valuation allowances are established when it is estimated that it is more likely than not that the tax benefit of the deferred tax asset will not be realized. We perform a comprehensive review of our uncertain tax positions on a quarterly basis. Tax benefits are recognized when it is more likely than not that a tax position will be sustained upon examination by the authorities. The benefit from a position that has surpassed the more-likely-than-not threshold is measured as the largest amount of benefit that is more than 50% likely to be realized upon settlement. We recognize interest and penalties accrued related to unrecognized tax benefits as a component of income tax expense. |
Foreign Currencies | Foreign Currencies The currency effects of translating into U.S. dollars the financial statements of our foreign subsidiaries, which typically use the local currency of the countries in which they are located, are included in other comprehensive (loss) income. Gains and losses resulting from foreign currency transactions are included in the results of operations in the Other expense, net caption and amounted to $6.2 million, $4.0 million and $2.3 million of losses in 2022, 2021 and 2020, respectively. |
Impact of Recently Issued Accounting Standards - Adopted | Impact of Recently Issued Accounting Standards—Adopted Reference Rate Reform Note 9—“Debt” |
Acquisitions (Tables)
Acquisitions (Tables) - 2021 Acquisitions | 12 Months Ended |
Dec. 31, 2022 | |
Acquisitions | |
Schedule of allocation of the purchase price of acquisition to the fair value of the assets acquired and liabilities assumed | (in millions) Cash $ 1.0 Accounts receivable 107.2 Inventories 134.4 Property, plant and equipment 33.6 Operating lease right-of-use assets 29.8 Goodwill 177.3 Intangible assets subject to amortization 116.3 Intangible assets not subject to amortization 51.2 Other current and long-term assets 4.0 Total assets acquired 654.8 Deferred taxes 48.6 Operating lease liabilities 24.6 Other current and long-term liabilities 141.3 Total liabilities assumed 214.5 Net assets acquired $ 440.3 |
Schedule of pro forma information | Year Ended December 31, 2021 2020 (in millions, except per share amounts) Pro forma: Net sales $ 14,820.5 $ 9,345.4 Net income attributable to Reliance $ 1,518.0 $ 356.6 Earnings per share attributable to Reliance stockholders: Basic $ 24.01 $ 5.54 Diluted $ 23.60 $ 5.46 |
Inventories (Tables)
Inventories (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Inventories | |
Schedule of inventories | December 31, December 31, 2022 2021 (in millions) LIFO inventories - cost on FIFO method $ 2,257.9 $ 2,498.2 Cost on FIFO method higher than LIFO value (743.8) (820.4) Inventories - stated on LIFO method 1,514.1 1,677.8 Inventories - stated on FIFO method 481.2 387.2 $ 1,995.3 $ 2,065.0 |
Schedule of changes in the LIFO valuation reserve | Year Ended December 31, 2022 2021 2020 (in millions) LIFO inventory valuation reserve (income) expense $ (76.6) $ 704.8 $ (22.0) |
Revenues (Tables)
Revenues (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Revenues. | |
Schedule of disaggregation of revenue | The following table presents our sales disaggregated by product and service. Year Ended December 31, 2022 2021 2020 (in millions) Carbon steel $ 9,487.7 $ 8,532.0 $ 4,647.4 Stainless steel 2,877.4 2,267.0 1,435.6 Aluminum 2,658.7 2,050.9 1,687.6 Alloy 741.0 547.5 436.5 Toll processing and logistics 554.2 470.7 387.5 Copper and brass 336.7 112.2 50.5 Other and eliminations 369.3 113.0 166.8 Total $ 17,025.0 $ 14,093.3 $ 8,811.9 |
Goodwill (Tables)
Goodwill (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Goodwill. | |
Schedule of changes in the carrying amount of goodwill | (in millions) Balance at January 1, 2021 $ 1,935.2 Acquisitions 172.0 Effect of foreign currency translation 0.4 Balance at December 31, 2021 2,107.6 Purchase price allocation adjustments 5.3 Effect of foreign currency translation (7.0) Balance at December 31, 2022 $ 2,105.9 |
Intangible Assets, net (Tables)
Intangible Assets, net (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Intangible Assets, net | |
Summary of intangible assets, net | December 31, 2022 December 31, 2021 Weighted Average Gross Gross Amortizable Carrying Accumulated Carrying Accumulated Life in Years Amount Amortization Amount Amortization (in millions) Intangible assets subject to amortization: Customer lists/relationships 14.2 $ 713.6 $ (479.3) $ 713.0 $ (435.1) Backlog of orders 7.9 22.3 (3.1) 15.8 (0.2) Other 9.1 9.9 (9.5) 9.9 (9.4) 745.8 (491.9) 738.7 (444.7) Intangible assets not subject to amortization: Trade names 765.7 — 783.7 — $ 1,511.5 $ (491.9) $ 1,522.4 $ (444.7) |
Summary of estimated aggregate amortization expense | (in millions) 2023 $ 43.6 2024 40.1 2025 35.9 2026 26.4 2027 25.8 |
Debt (Tables)
Debt (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Debt | |
Summary of debt | December 31, December 31, 2022 2021 (in millions) Unsecured revolving credit facility maturing September 3, 2025 $ — $ — Senior unsecured notes, interest payable semi-annually at 4.50%, effective rate of 4.63%, redeemed on January 15, 2023 500.0 500.0 Senior unsecured notes, interest payable semi-annually at 1.30%, effective rate of 1.53%, maturing August 15, 2025 400.0 400.0 Senior unsecured notes, interest payable semi-annually at 2.15%, effective rate of 2.27%, maturing August 15, 2030 500.0 500.0 Senior unsecured notes, interest payable semi-annually at 6.85%, effective rate of 6.91%, maturing November 15, 2036 250.0 250.0 Other notes and revolving credit facilities 9.6 12.4 Total 1,659.6 1,662.4 Less: unamortized discount and debt issuance costs (12.0) (15.4) Less: amounts due within one year and short-term borrowings (508.2) (5.0) Total long-term debt $ 1,139.4 $ 1,642.0 |
Summary of aggregate maturities of long-term debt for each of the next five years and thereafter | (in millions) 2023 $ 508.2 2024 0.3 2025 400.3 2026 0.4 2027 0.4 Thereafter 750.0 $ 1,659.6 |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Leases | |
Schedule of lease cost | Year Ended December 31, 2022 2021 2020 (in millions) Operating lease cost $ 91.4 $ 82.2 $ 82.1 |
Schedule of supplemental cash flow and other lease information | Year Ended December 31, 2022 2021 2020 (in millions) Supplemental cash flow information: Cash payments for operating leases $ 86.9 $ 81.7 $ 81.7 Right-of-use assets obtained in exchange for operating lease obligations $ 52.4 $ 46.8 $ 58.8 December 31, December 31, 2022 2021 Other lease information: Weighted average remaining lease term—operating leases 6.6 years 5.8 years Weighted average discount rate—operating leases 3.8% 3.3% |
Schedule of maturities of operating lease liabilities | (in millions) 2023 $ 59.1 2024 48.9 2025 36.3 2026 24.8 2027 17.5 Thereafter 64.8 Total operating lease payments 251.4 Less: imputed interest (33.7) Total operating lease liabilities $ 217.7 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Income Taxes | |
Schedule of components of the provision for income taxes attributable to continuing operations | Year Ended December 31, 2022 2021 2020 (in millions) Current: Federal $ 418.9 $ 362.9 $ 77.6 State 112.9 98.0 24.9 Foreign 61.1 28.6 17.0 592.9 489.5 119.5 Deferred: Federal (3.7) (20.2) (7.1) State (2.0) (4.0) 0.3 Foreign (1.0) 0.4 (6.9) (6.7) (23.8) (13.7) $ 586.2 $ 465.7 $ 105.8 |
Components of U.S. and international income before income taxes | Year Ended December 31, 2022 2021 2020 (in millions) U.S. $ 2,199.2 $ 1,778.5 $ 465.9 International 231.2 104.6 12.3 Income before income taxes $ 2,430.4 $ 1,883.1 $ 478.2 |
Schedule of reconciliation of income tax at the U.S. federal statutory tax rates to income tax expense | Year Ended December 31, 2022 2021 2020 Income tax at U.S. federal statutory tax rate 21.0 % 21.0 % 21.0 % State income tax, net of federal tax effect 3.5 3.8 3.6 Foreign earnings taxed at higher rates 0.5 0.4 1.0 Net effect of life insurance policies (0.6) (0.8) (2.9) Net effect of changes in unrecognized tax benefits — 0.1 (0.3) Stock-based compensation — 0.3 0.8 Other, net (0.3) (0.1) (1.1) Effective tax rate 24.1 % 24.7 % 22.1 % |
Schedule of components of the Company's deferred tax assets and liabilities | December 31, 2022 2021 (in millions) Deferred tax assets: Allowance for doubtful accounts $ 6.6 $ 6.6 Inventory costs capitalized for tax purposes 12.0 12.9 LIFO inventories 0.7 — Accrued expenses not currently deductible for tax 29.2 36.9 Stock-based compensation 11.1 10.1 Net operating loss carryforwards 3.2 3.9 Tax credits carryforwards 0.7 0.9 Total deferred tax assets 63.5 71.3 Deferred tax liabilities: Property, plant and equipment, net (196.8) (183.1) Goodwill and other intangible assets (340.9) (342.0) LIFO inventories — (25.0) Other (2.4) (6.0) Total deferred tax liabilities (540.1) (556.1) Net deferred tax liabilities $ (476.6) $ (484.8) |
Schedule of reconciliation of the beginning and ending balances of the total amounts of unrecognized tax benefits | Year Ended December 31, 2022 2021 2020 (in millions) Unrecognized tax benefits at January 1 $ 1.9 $ 1.0 $ 2.2 Increases in tax positions for prior years 0.8 — — Increases in tax positions for current year — 1.0 — Settlements (0.8) — (1.1) Lapse of statute of limitations (0.5) (0.1) (0.1) Unrecognized tax benefits at December 31 $ 1.4 $ 1.9 $ 1.0 |
Stock-Based Compensation Plans
Stock-Based Compensation Plans (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Stock-Based Compensation Plans | |
Summary of the status of the Company's restricted stock units and changes during the year | A summary of the status of our unvested RSUs and PSUs as of December 31, 2022 and changes during the year then ended is as follows: Weighted Average RSU and PSU Grant Date Aggregate Units Fair Value Unvested at January 1, 2022 831,597 $ 105.12 Granted 305,249 187.31 Vested (518,743) 84.82 Cancelled or forfeited (36,091) 132.95 Unvested at December 31, 2022 582,012 $ 164.60 |
Employee Benefits (Tables)
Employee Benefits (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Employee Benefits | |
Summary of benefits payments under the SERPs and Defined Benefit Plans, which reflect expected future employee service, as appropriate, expected to be paid in the future periods | Defined SERPs Benefit Plan (in millions) 2023 $ 0.8 $ 2.6 2024 0.8 2.7 2025 0.8 2.9 2026 0.8 3.1 2027 1.2 3.2 2028-2032 20.7 18.0 |
Schedule of Company's expense for Reliance-sponsored retirement plans | Year Ended December 31, 2022 2021 2020 (in millions) Master 401(k) Plan $ 28.1 $ 25.6 $ 21.2 Precision Strip Retirement and Savings Plan 9.2 8.0 5.2 Supplemental Executive Retirement Plans 4.0 3.4 10.5 Deferred Compensation Plan 2.0 2.5 (0.3) Other Defined Contribution Plans 2.0 2.0 1.7 Defined Benefit Plans 0.3 1.5 14.7 $ 45.6 $ 43.0 $ 53.0 |
SERP's and Defined Benefit Plans | |
Employee Benefits | |
Summary of the status of the funding of the plans, change in plan assets and items not yet recognized as a component of net periodic pension expense | SERPs Defined Benefit Plan 2022 2021 2022 2021 (in millions) (in millions) Change in benefit obligation: Benefit obligation at beginning of year $ 36.4 $ 37.5 $ 74.5 $ 76.3 Service cost 0.4 1.0 2.0 2.2 Interest cost 0.7 0.6 2.0 1.8 Actuarial gain (1) (5.6) (1.8) (21.0) (3.6) Benefits paid (0.8) (0.9) (2.5) (2.2) Plan settlement (12.3) — — — Benefit obligation at end of year $ 18.8 $ 36.4 $ 55.0 $ 74.5 Change in plan assets: Fair value of plan assets at beginning of year N/A N/A $ 70.9 $ 63.9 Actual return on plan assets N/A N/A (11.7) 9.2 Benefits paid N/A N/A (2.5) (2.2) Fair value of plan assets at end of year N/A N/A $ 56.7 $ 70.9 Funded status: Funded status of the plans $ (18.8) $ (36.4) $ 1.7 $ (3.6) Items not yet recognized as component of net periodic pension expense: Unrecognized net actuarial losses $ 1.9 $ 10.5 $ 0.5 $ 5.6 Unamortized prior service cost — — 2.8 3.4 $ 1.9 $ 10.5 $ 3.3 $ 9.0 (1) Actuarial gains in 2022 and 2021 were primarily due to increases in the discount rate used to measure the obligations. |
Schedule of amounts recognized in the statement of financial position | SERPs Defined Benefit Plan 2022 2021 2022 2021 (in millions) (in millions) Amounts recognized in the statement of financial position: Noncurrent assets $ — $ — $ 1.7 $ — Current liabilities (0.8) (12.9) — — Noncurrent liabilities (18.0) (23.5) — (3.6) Accumulated other comprehensive loss 1.9 10.5 3.3 9.0 Net amount recognized $ (16.9) $ (25.9) $ 5.0 $ 5.4 |
Schedule of details of net periodic pension expense | Details of net periodic benefit cost related to the SERPs and Defined Benefit Plans are presented below: SERPs Defined Benefit Plans Year Ended December 31, Year Ended December 31, 2022 2021 2020 2022 2021 2020 (in millions) (in millions) Service cost $ 0.4 $ 1.0 $ 0.9 $ 2.0 $ 2.2 $ 2.1 Interest cost 0.7 0.6 1.0 2.0 1.8 2.6 Expected return on plan assets — — — (4.2) (3.9) (4.4) Settlement losses 2.3 — 6.7 — — 12.7 Prior service cost — — — 0.5 0.6 0.6 Amortization of net loss 0.6 1.8 1.9 — 0.8 1.1 $ 4.0 $ 3.4 $ 10.5 $ 0.3 $ 1.5 $ 14.7 Net periodic benefit cost related to the SERPs and the Defined Benefit Plans is presented in our consolidated statements of income, as summarized below: SERPs Defined Benefit Plans Year Ended December 31, Year Ended December 31, 2022 2021 2020 2022 2021 2020 (in millions) (in millions) Amounts recognized in the statement of income: Warehouse, delivery, selling, general and administrative expense $ 0.4 $ 1.0 $ 0.9 $ 2.0 $ 2.2 $ 2.1 Other expense (income), net 3.6 2.4 9.6 (1.7) (0.7) 12.6 $ 4.0 $ 3.4 $ 10.5 $ 0.3 $ 1.5 $ 14.7 |
Schedule of assumptions used to determine net periodic benefit cost | SERPs Defined Benefit Plans Year Ended December 31, Year Ended December 31, 2022 2021 2020 2022 2021 2020 Weighted average assumptions to determine net cost: Discount rate 2.17 % 1.64 % 2.63 % 2.70 % 2.40 % 2.85 % Expected long-term rate of return on plan assets N/A N/A N/A 6.00 % 6.25 % 6.25 % Rate of compensation increase 6.00 % 6.00 % 6.00 % N/A N/A N/A |
Schedule of assumptions used to determine the benefit obligation | SERPs Defined Benefit Plan December 31, December 31, 2022 2021 2022 2021 Weighted average assumptions to determine benefit obligations: Discount rate 4.51 % 2.16 % 5.00 % 2.70 % Expected long-term rate of return on plan assets N/A N/A 6.00 % 6.25 % Rate of compensation increase 6.00 % 6.00 % N/A N/A |
Defined Benefit Plans | |
Employee Benefits | |
Schedule of weighted-average asset allocations of the Company's Defined Benefit Plans by asset category | December 31, 2022 2021 Plan assets: Equity securities 58 % 66 % Debt securities 38 32 Cash and cash equivalents 4 2 Total 100 % 100 % |
Schedule of fair value measurements of Defined Benefit Plans assets | Level 1 Level 2 Level 3 Total (in millions) December 31, 2022 Common stock (1) $ 31.4 $ — $ — $ 31.4 U.S. government, state and agency — 6.0 — 6.0 Corporate debt securities (2) — 4.6 — 4.6 Mutual funds (3) 12.6 — — 12.6 Interest bearing cash 2.1 — — 2.1 Total investments at fair value $ 46.1 $ 10.6 $ — $ 56.7 December 31, 2021 Common stock (1) $ 39.0 $ — $ — $ 39.0 U.S. government, state and agency — 5.1 — 5.1 Corporate debt securities (2) — 4.9 — 4.9 Mutual funds (3) 20.6 — — 20.6 Interest bearing cash 1.3 — — 1.3 Total investments at fair value $ 60.9 $ 10.0 $ — $ 70.9 (1) Comprised primarily of securities of large domestic and foreign companies. Valued at the closing price reported on the active market on which the individual securities are traded on national exchanges. (2) Valued using pricing models maximizing the use of observable inputs for similar securities. This includes basing values on a combination of inputs, including benchmark yields, reported trades, broker/dealer quotes, issuer spreads, two-sided markets, benchmark securities, bids, offers and reference data. (3) Mutual funds held are registered with the United States Securities and Exchange Commission. These funds are required to publish their daily net asset value (NAV) and to transact at that price. The mutual funds held are deemed to be actively traded. |
Equity (Tables)
Equity (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Equity | |
Schedule of issued and outstanding common shares activity | Year Ended December 31, 2022 2021 2020 (in thousands) Issued and outstanding common shares, beginning balances 61,806 63,600 66,854 Issued to settle RSUs and PSUs, net of withheld shares 506 313 414 Issued for stock option exercises — — 6 Repurchased (3,525) (2,107) (3,674) Issued and outstanding common shares, ending balances 58,787 61,806 63,600 |
Schedule of share repurchase activity | Average Cost Shares Per Share Amount (in thousands) (in millions) 2022 3,525 $ 178.81 $ 630.3 2021 2,107 $ 153.55 $ 323.5 2020 3,674 $ 91.80 $ 337.3 |
Schedule of accumulated other comprehensive loss | Pension and Foreign Currency Postretirement Benefit Accumulated Other Translation Plan Adjustments, Comprehensive Loss Net of Tax Loss (in millions) Balance as of January 1, 2022 $ (55.2) $ (13.7) $ (68.9) Current-year change (28.8) 11.4 (17.4) Balance as of December 31, 2022 $ (84.0) $ (2.3) $ (86.3) |
Other Expense (Income), net (Ta
Other Expense (Income), net (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Other Expense (Income), net. | |
Schedule of significant components of other expense (income), net | Year Ended December 31, 2022 2021 2020 (in millions) Investment income from life insurance policies $ (85.2) $ (84.6) $ (79.3) Interest expense on life insurance policy loans 91.6 85.5 79.4 Life insurance policy cost of insurance 15.7 14.4 13.4 Income from life insurance policy redemptions (6.6) (6.2) (4.6) Foreign currency transaction losses 6.2 4.0 2.3 Net periodic benefit cost—settlement losses 2.3 — 19.4 Net periodic benefit cost—components other than service cost and settlement loss (0.4) 1.7 2.8 Loss (income) on deferred compensation plan assets 6.9 (4.1) (4.3) Interest income (9.3) (1.1) (0.9) All other, net (7.0) (6.5) (3.5) $ 14.2 $ 3.1 $ 24.7 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Earnings Per Share | |
Computation of basic and diluted earnings per share | Year Ended December 31, 2022 2021 2020 (in millions, except share amounts which are reflected in thousands and per share amounts) Numerator: Net income attributable to Reliance $ 1,840.1 $ 1,413.0 $ 369.1 Denominator: Weighted average shares outstanding 60,559 63,217 64,328 Dilutive effect of stock-based awards 936 1,110 935 Weighted average diluted shares outstanding 61,495 64,327 65,263 Earnings per share attributable to Reliance stockholders: Basic $ 30.39 $ 22.35 $ 5.74 Diluted $ 29.92 $ 21.97 $ 5.66 |
Segment Information (Tables)
Segment Information (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Segment Information | |
Schedule of sales, by products or services | 2022 2021 2020 Carbon steel 54 % 58 % 51 % Stainless steel 17 16 16 Aluminum 15 14 19 Alloy 4 4 5 Toll processing and logistics 3 3 4 Copper and brass 2 1 1 Other 5 4 4 Total 100 % 100 % 100 % |
Summary of the Company's operations by geographic location based on where sales originated from | United States Foreign Countries Total (in millions) Year Ended December 31, 2022: Net sales $ 15,978.6 $ 1,046.4 $ 17,025.0 Long-lived assets 5,051.9 391.4 5,443.3 Year Ended December 31, 2021: Net sales 13,371.7 721.6 14,093.3 Long-lived assets 4,971.2 404.7 5,375.9 Year Ended December 31, 2020: Net sales 8,180.7 631.2 8,811.9 Long-lived assets 4,709.1 284.9 4,994.0 |
Impairment and Restructuring _2
Impairment and Restructuring Charges (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Impairment and Restructuring Charges | |
Schedule of impairment and restructuring charges | Year Ended December 31, 2022 2021 2020 (in millions) Intangible assets, net $ — $ 4.7 $ 98.5 Property, plant and equipment — — 9.3 Operating lease right-of-use assets — — 0.2 Total impairment charges — 4.7 108.0 Restructuring––cost of sales — — 38.2 Restructuring––SG&A 1.4 0.1 11.6 Total impairment and restructuring charges $ 1.4 $ 4.8 $ 157.8 |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies - Business (Details) | 12 Months Ended |
Dec. 31, 2022 item location | |
Summary of Significant Accounting Policies | |
Approximate number of locations in which company operates metal service center network | location | 315 |
Number of states in which the company operates metal service center network | 40 |
Number of countries in which entity operates outside the U.S. | 12 |
Minimum number of products the company distributes | 100,000 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Reclassification (Details) - USD ($) $ in Millions | Dec. 31, 2022 | Dec. 31, 2021 |
Reclassification | ||
Other long-term liabilities | $ 51.4 | $ 50.2 |
Deferred Compensation Plan Liabilities Reclassification | Reclassification Adjustment | ||
Reclassification | ||
Long-term retirement benefits | (43.2) | |
Other long-term liabilities | $ 43.2 |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Fair Value (Details) - USD ($) $ in Millions | Dec. 31, 2022 | Dec. 31, 2021 |
Fair Values of Financial Instruments | ||
Total debt | $ 1,659.6 | $ 1,662.4 |
Senior Unsecured Notes - Publicly Traded | ||
Fair Values of Financial Instruments | ||
Carrying value, before deducting unamortized discount or premiums | 1,650 | 1,650 |
Carrying value | 1,640 | 1,640 |
Senior Unsecured Notes - Publicly Traded | Level 2 | ||
Fair Values of Financial Instruments | ||
Fair value | $ 1,530 | $ 1,750 |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies - Goodwill and Other Indefinite-Lived Intangible Assets (Details) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 USD ($) item segment | Dec. 31, 2021 USD ($) segment item | Dec. 31, 2020 USD ($) item segment | |
Goodwill and Other Indefinite-Lived Intangible Assets | |||
Number of operating segments | segment | 1 | 1 | 1 |
Number of reportable segments | item | 1 | 1 | 1 |
Impairment of goodwill | $ 0 | $ 0 | $ 0 |
Impairment of Intangible Assets, Indefinite-lived (Excluding Goodwill) | $ 0 | $ 4.7 | $ 67.8 |
Impairment, Intangible Asset, Indefinite-Lived (Excluding Goodwill), Statement of Income or Comprehensive Income [Extensible Enumeration] | Asset Impairment Charges | Asset Impairment Charges |
Summary of Significant Accoun_7
Summary of Significant Accounting Policies - Long-Lived Assets (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Property, Plant and Equipment | |||
Impairment losses of property, plant and equipment | $ 0 | $ 0 | $ 9,300,000 |
Impairment losses of intangible assets, finite-lived | $ 30,700,000 | ||
Impairment, Intangible Asset, Finite-Lived, Statement of Income or Comprehensive Income [Extensible Enumeration] | Asset Impairment Charges | ||
Buildings | Minimum | |||
Property, Plant and Equipment | |||
Useful lives | 5 years | ||
Buildings | Maximum | |||
Property, Plant and Equipment | |||
Useful lives | 50 years | ||
Machinery and equipment | Minimum | |||
Property, Plant and Equipment | |||
Useful lives | 3 years | ||
Machinery and equipment | Maximum | |||
Property, Plant and Equipment | |||
Useful lives | 20 years |
Summary of Significant Accoun_8
Summary of Significant Accounting Policies - Revenue Recognition, Share-Based Compensation and Foreign Currencies (Details) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 USD ($) item | Dec. 31, 2021 USD ($) | Dec. 31, 2020 USD ($) | |
Revenue Recognition | |||
Number of performance obligations from sales of metal products | item | 1 | ||
Shipping and handling costs included in operating expenses | $ 509.7 | $ 424.6 | $ 357.4 |
Share-Based Compensation | |||
Stock-based compensation expense | 65.3 | 70.8 | 42.2 |
Foreign Currencies | |||
Net gain (loss) resulting from foreign currency transactions | $ (6.2) | $ (4) | $ (2.3) |
Toll processing | |||
Revenue Recognition | |||
Number Of Days To Perform Services | 1 day |
Acquisitions (Details)
Acquisitions (Details) $ / shares in Units, $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 USD ($) item | Dec. 31, 2021 USD ($) $ / shares | Dec. 31, 2020 USD ($) $ / shares | |
Acquisitions | |||
Net sales | $ 17,025 | $ 14,093.3 | $ 8,811.9 |
Number of states in which the company operates metal service center network | item | 40 | ||
Allocation of the total purchase price of the acquisitions to the fair value of the assets acquired and liabilities assumed | |||
Goodwill | $ 2,105.9 | 2,107.6 | 1,935.2 |
Summary purchase price allocation information for all acquisitions | |||
Tax deductible goodwill amount | 854.5 | ||
Trade names | |||
Allocation of the total purchase price of the acquisitions to the fair value of the assets acquired and liabilities assumed | |||
Intangible assets not subject to amortization | 51.2 | ||
Production backlog | |||
Allocation of the total purchase price of the acquisitions to the fair value of the assets acquired and liabilities assumed | |||
Intangible assets subject to amortization | $ 23.8 | ||
Summary purchase price allocation information for all acquisitions | |||
Weighted average lives of identifiable intangible assets | 7 years 10 months 24 days | ||
Customer relationships | |||
Summary purchase price allocation information for all acquisitions | |||
Intangible assets acquired subject to amortization | $ 92.3 | ||
Weighted average lives of identifiable intangible assets | 10 years | ||
2021 Acquisitions | |||
Acquisitions | |||
Net sales | $ 863 | ||
Transaction costs | 7.7 | ||
Allocation of the total purchase price of the acquisitions to the fair value of the assets acquired and liabilities assumed | |||
Cash | 1 | ||
Accounts receivable | 107.2 | ||
Inventories | 134.4 | ||
Property, plant and equipment | 33.6 | ||
Operating lease right-of-use assets | 29.8 | ||
Goodwill | 177.3 | ||
Intangible assets subject to amortization | 116.3 | ||
Intangible assets not subject to amortization | 51.2 | ||
Other current and long-term assets | 4 | ||
Total assets acquired | 654.8 | ||
Deferred taxes | 48.6 | ||
Operating lease liabilities | 24.6 | ||
Other current and long-term liabilities | 141.3 | ||
Total liabilities assumed | 214.5 | ||
Net assets acquired | 440.3 | ||
Pro forma financial information | |||
Non-recurring Inventory step-up amortization | 21.8 | ||
Non-recurring excess renumeration payments | 7.8 | ||
Non-recurring acquisition related costs | 7.7 | ||
Pro forma net income attributable to Reliance after non-recurring items | $ 384.6 | ||
Pro forma diluted earnings per share adjusted for non-recurring items | $ / shares | $ 5.89 | ||
Pro forma: | |||
Net sales | 14,820.5 | $ 9,345.4 | |
Net income attributable to Reliance | $ 1,518 | $ 356.6 | |
Basic earnings per common share attributable to Reliance shareholders (in dollars per share) | $ / shares | $ 24.01 | $ 5.54 | |
Diluted earnings per common share attributable to Reliance shareholders (in dollars per share) | $ / shares | $ 23.60 | $ 5.46 | |
Summary purchase price allocation information for all acquisitions | |||
Tax deductible goodwill amount | $ 106.4 |
Joint Ventures and Noncontrol_2
Joint Ventures and Noncontrolling Interests (Details) - USD ($) $ in Millions | Mar. 31, 2020 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Mar. 30, 2020 | Dec. 31, 2019 |
Joint Ventures and Noncontrolling Interests | ||||||
Equity | $ 7,095.9 | $ 6,093.7 | $ 5,122.7 | $ 5,214.1 | ||
Feralloy Processing Company | ||||||
Joint Ventures and Noncontrolling Interests | ||||||
Equity | $ (5.5) | |||||
Payments for acquired equity interest | 8 | |||||
Carrying value of noncontrolling interest | 1.1 | |||||
Increase to additional paid in capital for the direct tax effects resulting from the transaction | $ 1.4 | |||||
Ownership percentage acquired | 49% | |||||
Ownership percentage in consolidated investments other than equity method investment | 100% | 51% | ||||
Indiana Pickling & Processing Company | ||||||
Joint Ventures and Noncontrolling Interests | ||||||
Ownership percentage in consolidated investments other than equity method investment | 56% | |||||
Valex Corp. | South Korea | ||||||
Joint Ventures and Noncontrolling Interests | ||||||
Ownership percentage in consolidated investments other than equity method investment | 96% | |||||
Minimum | ||||||
Joint Ventures and Noncontrolling Interests | ||||||
Ownership percentage of investee for accounting under the equity method of accounting | 20% | |||||
Percentage of ownership for consolidation of financial statements | 50% | |||||
Maximum | ||||||
Joint Ventures and Noncontrolling Interests | ||||||
Ownership percentage of investee for accounting under the equity method of accounting | 50% |
Inventories (Details)
Inventories (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Inventories | |||
LIFO inventories - cost on FIFO method | $ 2,257.9 | $ 2,498.2 | |
Cost on FIFO method higher than LIFO value | (743.8) | (820.4) | |
Inventories - stated on LIFO method | 1,514.1 | 1,677.8 | |
Inventories - stated on FIFO method | 481.2 | 387.2 | |
Inventories | 1,995.3 | 2,065 | |
LIFO inventory valuation reserve expense (income) | $ (76.6) | $ 704.8 | $ (22) |
Revenues (Details)
Revenues (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Revenue Disaggregation | |||
Revenue | $ 17,025 | $ 14,093.3 | $ 8,811.9 |
Carbon steel | |||
Revenue Disaggregation | |||
Revenue | 9,487.7 | 8,532 | 4,647.4 |
Stainless steel | |||
Revenue Disaggregation | |||
Revenue | 2,877.4 | 2,267 | 1,435.6 |
Aluminum | |||
Revenue Disaggregation | |||
Revenue | 2,658.7 | 2,050.9 | 1,687.6 |
Alloy | |||
Revenue Disaggregation | |||
Revenue | 741 | 547.5 | 436.5 |
Toll processing and logistics | |||
Revenue Disaggregation | |||
Revenue | 554.2 | 470.7 | 387.5 |
Copper and brass | |||
Revenue Disaggregation | |||
Revenue | 336.7 | 112.2 | 50.5 |
Other and eliminations | |||
Revenue Disaggregation | |||
Revenue | $ 369.3 | $ 113 | $ 166.8 |
Goodwill (Details)
Goodwill (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Change in the carrying amount of goodwill | ||
Balance at the beginning of the period | $ 2,107.6 | $ 1,935.2 |
Acquisitions | 172 | |
Purchase price allocation adjustments | 5.3 | |
Effect of foreign currency translation | (7) | 0.4 |
Balance at the end of the period | 2,105.9 | 2,107.6 |
Accumulated impairment losses | $ 0 | $ 0 |
Intangible Assets, net (Details
Intangible Assets, net (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Intangible assets subject to amortization: | |||
Intangible assets subject to amortization, Gross Carrying Amount | $ 745.8 | $ 738.7 | |
Intangible assets subject to amortization, Accumulated Amortization | (491.9) | (444.7) | |
Intangible assets | |||
Intangible assets, Gross Carrying Amount | 1,511.5 | 1,522.4 | |
Amortization expense for intangible assets | 48.1 | 38.7 | $ 39.6 |
Changes in intangible assets due to foreign currency translation gains (losses) | (4) | 0.3 | |
Impairment losses of intangible assets, indefinite-lived | 0 | $ 4.7 | $ 67.8 |
Impairment, Intangible Asset, Indefinite-Lived (Excluding Goodwill), Statement of Income or Comprehensive Income [Extensible Enumeration] | Asset Impairment Charges | Asset Impairment Charges | |
Impairment losses of intangible assets, finite-lived | $ 30.7 | ||
Impairment, Intangible Asset, Finite-Lived, Statement of Income or Comprehensive Income [Extensible Enumeration] | Asset Impairment Charges | ||
Impairment losses of intangible assets | $ 98.5 | ||
Summary of estimated aggregate amortization expense for each of the succeeding five years | |||
2023 | 43.6 | ||
2024 | 40.1 | ||
2025 | 35.9 | ||
2026 | 26.4 | ||
2027 | 25.8 | ||
2021 Acquisitions | |||
Intangible assets | |||
Intangible assets subject to amortization | 116.3 | ||
Trade names | |||
Intangible assets not subject to amortization: | |||
Intangible assets not subject to amortization, Gross Carrying Amount | 765.7 | $ 783.7 | |
Intangible assets | |||
Impairment losses of intangible assets, indefinite-lived | 4.7 | 67.8 | |
Trade names | 2021 Acquisitions | |||
Intangible assets | |||
Increase (decrease) in purchase price allocation of intangible assets | $ (16.9) | ||
Customer lists/relationships | |||
Intangible assets subject to amortization: | |||
Weighted average amortizable life in years | 14 years 2 months 12 days | ||
Intangible assets subject to amortization, Gross Carrying Amount | $ 713.6 | 713 | |
Intangible assets subject to amortization, Accumulated Amortization | (479.3) | (435.1) | |
Intangible assets | |||
Impairment losses of intangible assets, finite-lived | $ 30.7 | ||
Customer lists/relationships | 2021 Acquisitions | |||
Intangible assets | |||
Increase (decrease) in purchase price allocation of intangible assets | $ 2.7 | ||
Backlog of orders | |||
Intangible assets subject to amortization: | |||
Weighted average amortizable life in years | 7 years 10 months 24 days | ||
Intangible assets subject to amortization, Gross Carrying Amount | $ 22.3 | 15.8 | |
Intangible assets subject to amortization, Accumulated Amortization | (3.1) | (0.2) | |
Backlog of orders | 2021 Acquisitions | |||
Intangible assets | |||
Increase (decrease) in purchase price allocation of intangible assets | $ 8 | ||
Others | |||
Intangible assets subject to amortization: | |||
Weighted average amortizable life in years | 9 years 1 month 6 days | ||
Intangible assets subject to amortization, Gross Carrying Amount | $ 9.9 | 9.9 | |
Intangible assets subject to amortization, Accumulated Amortization | $ (9.5) | $ (9.4) |
Cash Surrender Value of Life _2
Cash Surrender Value of Life Insurance Policies, net (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Information about cash surrender value of life insurance policies | |||
Cash surrender value of all life insurance policies, net of loans and related accrued interest | $ 42 | $ 44.9 | |
Borrowed portion | |||
Information about cash surrender value of life insurance policies | |||
Amount of borrowed funds against cash surrender value of certain life insurance policies used to pay premiums and accrued interest owed | 73.1 | 68 | $ 60 |
Paid premiums and accrued interest on loans against policies | $ 93 | 86.3 | $ 76.8 |
Earle M. Jorgensen Company ("EMJ") | Borrowed portion | |||
Information about cash surrender value of life insurance policies | |||
Interest on borrowings against cash surrender value of certain life insurance policies (as a percent) | 11.76% | ||
Rate at which the portion of the policy cash surrender value earns interest and dividend income (as a percent) | 11.26% | ||
Loans and accrued interest outstanding on EMJ's life insurance policies | $ 849.5 | $ 789.1 | |
Earle M. Jorgensen Company ("EMJ") | Unborrowed portion | Minimum | |||
Information about cash surrender value of life insurance policies | |||
Rate at which the portion of the policy cash surrender value earns interest and dividend income (as a percent) | 4% |
Debt - Summary (Details)
Debt - Summary (Details) - USD ($) $ in Millions | Jan. 15, 2023 | Dec. 31, 2022 | Dec. 31, 2021 |
Debt | |||
Total | $ 1,659.6 | $ 1,662.4 | |
Less: unamortized discount and debt issuance costs | (12) | (15.4) | |
Less: amounts due within one year and short-term borrowings | (508.2) | (5) | |
Total long-term debt | 1,139.4 | 1,642 | |
Unsecured revolving credit facility maturing September 3, 2025 | |||
Debt | |||
Total | 0 | 0 | |
Senior unsecured notes, interest payable semi-annually at 4.50%, effective rate of 4.63%, redeemed on January 15, 2023 | |||
Debt | |||
Total | $ 500 | 500 | |
Semi-annual rate (as a percent) | 4.50% | 4.50% | |
Effective rate (as a percent) | 4.63% | ||
Senior unsecured notes, interest payable semi-annually at 1.30%, effective rate of 1.53%, maturing August 15, 2025 | |||
Debt | |||
Total | $ 400 | 400 | |
Semi-annual rate (as a percent) | 1.30% | ||
Effective rate (as a percent) | 1.53% | ||
Senior unsecured notes, interest payable semi-annually at 2.15%, effective rate of 2.27%, maturing August 15, 2030 | |||
Debt | |||
Total | $ 500 | 500 | |
Semi-annual rate (as a percent) | 2.15% | ||
Effective rate (as a percent) | 2.27% | ||
Senior unsecured notes, interest payable semi-annually at 6.85%, effective rate of 6.91%, maturing November 15, 2036 | |||
Debt | |||
Total | $ 250 | 250 | |
Semi-annual rate (as a percent) | 6.85% | ||
Effective rate (as a percent) | 6.91% | ||
Other notes and revolving credit facilities | |||
Debt | |||
Total | $ 9.6 | $ 12.4 |
Debt - Other (Details)
Debt - Other (Details) $ in Millions | 12 Months Ended | ||||||
Jan. 15, 2023 USD ($) | Jan. 12, 2023 | Sep. 03, 2020 USD ($) | Dec. 31, 2022 USD ($) item | Dec. 31, 2021 USD ($) | Dec. 31, 2020 USD ($) | Sep. 02, 2020 USD ($) | |
Debt | |||||||
Total | $ 1,659.6 | $ 1,662.4 | |||||
Principal payments on long-term debt | $ (0.3) | (20.7) | $ (1,615.4) | ||||
Number of financial maintenance covenants | item | 2 | ||||||
Aggregate maturities of long-term debt for each of the next five years and thereafter | |||||||
2023 | $ 508.2 | ||||||
2024 | 0.3 | ||||||
2025 | 400.3 | ||||||
2026 | 0.4 | ||||||
2027 | 0.4 | ||||||
Thereafter | 750 | ||||||
Total | 1,659.6 | 1,662.4 | |||||
Unsecured revolving credit facility maturing September 3, 2025 | |||||||
Debt | |||||||
Maximum borrowing capacity | $ 1,500 | $ 1,500 | |||||
Debt term | 5 years | ||||||
Total | 0 | 0 | |||||
Commitment fee on unused portion of revolving credit facility (as a percent) | 0.175% | ||||||
Letters of credit outstanding | 7.7 | 8.9 | |||||
Aggregate maturities of long-term debt for each of the next five years and thereafter | |||||||
Total | $ 0 | 0 | |||||
Unsecured revolving credit facility maturing September 3, 2025 | SOFR | |||||||
Debt | |||||||
Interest rate added to base (as a percent) | 1.10% | ||||||
Unsecured revolving credit facility maturing September 3, 2025 | Bank prime rate | |||||||
Debt | |||||||
Variable interest rate | bank prime rate | ||||||
Senior Unsecured Notes - Publicly Traded | |||||||
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% | ||||||
Senior unsecured notes, interest payable semi-annually at 4.50%, effective rate of 4.63%, redeemed on January 15, 2023 | |||||||
Debt | |||||||
Total | $ 500 | 500 | |||||
Semi-annual rate (as a percent) | 4.50% | 4.50% | |||||
Principal payments on long-term debt | $ (500) | ||||||
Aggregate maturities of long-term debt for each of the next five years and thereafter | |||||||
Total | $ 500 | 500 | |||||
Senior unsecured notes, interest payable semi-annually at 1.30%, effective rate of 1.53%, maturing August 15, 2025 | |||||||
Debt | |||||||
Total | $ 400 | 400 | |||||
Semi-annual rate (as a percent) | 1.30% | ||||||
Aggregate maturities of long-term debt for each of the next five years and thereafter | |||||||
Total | $ 400 | 400 | |||||
Senior unsecured notes, interest payable semi-annually at 2.15%, effective rate of 2.27%, maturing August 15, 2030 | |||||||
Debt | |||||||
Total | $ 500 | 500 | |||||
Semi-annual rate (as a percent) | 2.15% | ||||||
Aggregate maturities of long-term debt for each of the next five years and thereafter | |||||||
Total | $ 500 | 500 | |||||
Senior unsecured notes, interest payable semi-annually at 6.85%, effective rate of 6.91%, maturing November 15, 2036 | |||||||
Debt | |||||||
Total | $ 250 | 250 | |||||
Semi-annual rate (as a percent) | 6.85% | ||||||
Aggregate maturities of long-term debt for each of the next five years and thereafter | |||||||
Total | $ 250 | 250 | |||||
Other separate revolving credit facilities | Asia | |||||||
Debt | |||||||
Maximum borrowing capacity | 7.8 | ||||||
Lines of credit | 2.2 | 4.7 | |||||
IRB | |||||||
Debt | |||||||
Total | 7.4 | 7.7 | |||||
Aggregate maturities of long-term debt for each of the next five years and thereafter | |||||||
Total | 7.4 | $ 7.7 | |||||
Letter of Credit | Standby Facility | |||||||
Debt | |||||||
Maximum borrowing capacity | 50 | ||||||
Letters of credit outstanding | $ 18.7 |
Leases (Details)
Leases (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Operating lease cost | $ 91.4 | $ 82.2 | $ 82.1 |
Operating lease cost from related parties | 0.2 | 1.9 | 1.9 |
Cash payments for operating leases | 86.9 | 81.7 | 81.7 |
Right-of-use assets obtained in exchange for operating lease obligations | $ 52.4 | $ 46.8 | $ 58.8 |
Weighted average remaining lease term - operating leases | 6 years 7 months 6 days | 5 years 9 months 18 days | |
Weighted average discount rate - operating leases | 3.80% | 3.30% | |
Maturities of operating lease liabilities | |||
2023 | $ 59.1 | ||
2024 | 48.9 | ||
2025 | 36.3 | ||
2026 | 24.8 | ||
2027 | 17.5 | ||
Thereafter | 64.8 | ||
Total operating lease payments | 251.4 | ||
Less: imputed interest | (33.7) | ||
Total operating lease liabilities | 217.7 | ||
Maximum | |||
Finance right-of-use assets | 1 | ||
Finance right-of-use obligations | $ 1 |
Income Taxes - Summary, Reconci
Income Taxes - Summary, Reconciliation and Other (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Current: | |||
Federal | $ 418.9 | $ 362.9 | $ 77.6 |
State | 112.9 | 98 | 24.9 |
Foreign | 61.1 | 28.6 | 17 |
Total | 592.9 | 489.5 | 119.5 |
Deferred: | |||
Federal | (3.7) | (20.2) | (7.1) |
State | (2) | (4) | 0.3 |
Foreign | (1) | 0.4 | (6.9) |
Total | (6.7) | (23.8) | (13.7) |
Income tax provision | 586.2 | 465.7 | 105.8 |
Components of U.S. and international income before income taxes | |||
US | 2,199.2 | 1,778.5 | 465.9 |
International | 231.2 | 104.6 | 12.3 |
Income before income taxes | $ 2,430.4 | $ 1,883.1 | $ 478.2 |
Reconciliation of income tax at the U.S. federal statutory tax rates to income tax expense | |||
Income tax at U.S. federal statutory tax rate (as a percent) | 21% | 21% | 21% |
State income tax, net of federal tax effect (as a percent) | 3.50% | 3.80% | 3.60% |
Foreign earnings taxed at higher rates (as a percent) | 0.50% | 0.40% | 1% |
Net effect of life insurance policies (as a percent) | (0.60%) | (0.80%) | (2.90%) |
Net effect of changes in unrecognized tax benefits (as a percent) | 0.10% | (0.30%) | |
Stock-based compensation (as a percent) | 0.30% | 0.80% | |
Other, net (as a percent) | (0.30%) | (0.10%) | (1.10%) |
Effective tax rate (as a percent) | 24.10% | 24.70% | 22.10% |
Deferred tax assets: | |||
Allowance for doubtful accounts | $ 6.6 | $ 6.6 | |
Inventory costs capitalized for tax purposes | 12 | 12.9 | |
LIFO inventories | 0.7 | ||
Accrued expenses not currently deductible for tax | 29.2 | 36.9 | |
Stock-based compensation | 11.1 | 10.1 | |
Net operating loss carryforwards | 3.2 | 3.9 | |
Tax credits carryforwards | 0.7 | 0.9 | |
Total deferred tax assets | 63.5 | 71.3 | |
Deferred tax liabilities: | |||
Property, plant and equipment, net | (196.8) | (183.1) | |
Goodwill and other intangible assets | (340.9) | (342) | |
LIFO inventories | (25) | ||
Other | (2.4) | (6) | |
Total deferred tax liabilities | (540.1) | (556.1) | |
Net deferred tax liabilities | (476.6) | $ (484.8) | |
State | |||
Income Taxes | |||
Operating Loss Carryforwards | 3.6 | ||
Federal. | |||
Income Taxes | |||
Operating Loss Carryforwards | $ 0.4 |
Income Taxes - Unrecognized Tax
Income Taxes - Unrecognized Tax Benefits (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Reconciliation of the beginning and ending balances of the total amounts of unrecognized tax benefits | |||
Balance at the beginning of the year | $ 1.9 | $ 1 | $ 2.2 |
Increases in tax positions for prior years | 0.8 | ||
Increases in tax positions for current year | 1 | ||
Settlements | (0.8) | (1.1) | |
Lapse of statute of limitations | (0.5) | (0.1) | (0.1) |
Balance at the end of the year | 1.4 | 1.9 | $ 1 |
Unrecognized tax benefits, if recognized, would affect the effective tax rate | 1.4 | ||
Accrued interest and penalties on uncertain tax positions | $ 0.3 | $ 0.7 |
Stock-Based Compensation Plan_2
Stock-Based Compensation Plans - Stock Options and RSUs (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Share-based compensation plans | |||
Shares authorized for future grant | 1,690,229 | ||
Stock options and RSUs | |||
Additional share-based compensation disclosures | |||
Tax benefit realized from option and RSU exercises | $ 8 | $ 6.8 | $ 6.1 |
Stock-Based Compensation Plan_3
Stock-Based Compensation Plans - RSUs and PSUs (Details) - USD ($) $ / shares in Units, $ in Millions | 12 Months Ended | |||||
Dec. 31, 2024 | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Feb. 28, 2023 | |
Additional share-based compensation disclosures | ||||||
Total unrecognized compensation cost | $ 73.9 | |||||
Unvested RSUs and PSUs expected to be settled through issuance of common stock (in units) | 582,012 | |||||
Common stock to be issued for settlement of unvested RSUs and PSUs (in shares) | 802,184 | |||||
Weighted average recognition period for unrecognized compensation cost (in years) | 1 year 8 months 12 days | |||||
RSUs, 2022 grants | ||||||
Units | ||||||
The number of grants made during the period on the basis of service and/or performance criteria other than stock (or unit) option plans (for example, phantom stock or unit plan, stock or unit appreciation rights plan, performance target plan). | 192,798 | |||||
Share of common stock | 1 | |||||
RSUs, 2021 grant | ||||||
Units | ||||||
The number of grants made during the period on the basis of service and/or performance criteria other than stock (or unit) option plans (for example, phantom stock or unit plan, stock or unit appreciation rights plan, performance target plan). | 191,139 | |||||
Share of common stock | 1 | |||||
RSUs, 2020 grant | ||||||
Units | ||||||
The number of grants made during the period on the basis of service and/or performance criteria other than stock (or unit) option plans (for example, phantom stock or unit plan, stock or unit appreciation rights plan, performance target plan). | 330,144 | |||||
Share of common stock | 1 | |||||
PSUs, 2022 grants | ||||||
Units | ||||||
The number of grants made during the period on the basis of service and/or performance criteria other than stock (or unit) option plans (for example, phantom stock or unit plan, stock or unit appreciation rights plan, performance target plan). | 112,451 | |||||
PSUs, 2021 grant | ||||||
Units | ||||||
The number of grants made during the period on the basis of service and/or performance criteria other than stock (or unit) option plans (for example, phantom stock or unit plan, stock or unit appreciation rights plan, performance target plan). | 127,356 | |||||
PSUs, 2020 grant | ||||||
Units | ||||||
The number of grants made during the period on the basis of service and/or performance criteria other than stock (or unit) option plans (for example, phantom stock or unit plan, stock or unit appreciation rights plan, performance target plan). | 210,403 | |||||
PSUs, 2019 grant | ||||||
Changes | ||||||
Vested (in units) | (196,944) | |||||
Settled (in shares) | (393,888) | |||||
Restricted stock units (RSUs) and performance stock units (PSUs) | ||||||
Units | ||||||
Payments to tax authorities on employees' behalf for shares withheld related to share settlements | $ 39.7 | $ 21.2 | $ 23.1 | |||
Changes | ||||||
Unvested at the beginning of the year (in units) | 582,012 | 831,597 | ||||
Granted (in shares) | 305,249 | 318,495 | 540,547 | |||
Vested (in units) | (518,743) | |||||
Cancelled or forfeited (in units) | (36,091) | |||||
Unvested at the end of the period (in units) | 582,012 | 831,597 | ||||
Weighted Average Grant Date Fair Value | ||||||
Unvested at the beginning of the year (in dollars per unit) | $ 164.60 | $ 105.12 | ||||
Granted (in dollars per unit) | 187.31 | $ 141.41 | $ 82.81 | |||
Vested (in dollars per unit) | 84.82 | |||||
Cancelled or forfeited (in dollars per unit) | 132.95 | |||||
Unvested at the end of the period (in dollars per unit) | $ 164.60 | $ 105.12 | ||||
Additional share-based compensation disclosures | ||||||
Fair value of vested units | $ 147.2 | $ 126 | $ 54 | |||
Performance stock units (PSUs) | ||||||
Units | ||||||
Vesting period (in years) | 3 years | |||||
Performance target period (in years) | 3 years | 3 years | 3 years | |||
Maximum | PSUs, 2022 grants | ||||||
Units | ||||||
Share of common stock | 2 | |||||
Maximum | PSUs, 2021 grant | ||||||
Units | ||||||
Share of common stock | 2 | |||||
Maximum | PSUs, 2020 grant | ||||||
Units | ||||||
Share of common stock | 2 | |||||
Directors Equity Plan | Stock Awards | ||||||
Changes | ||||||
Granted (in shares) | 6,136 | 6,248 | 12,807 | |||
Weighted Average Grant Date Fair Value | ||||||
Granted (in dollars per unit) | $ 182.41 | $ 166.39 | $ 91.30 |
Employee Benefits - Defined Con
Employee Benefits - Defined Contribution Plan Information (Details) | 12 Months Ended |
Dec. 31, 2022 | |
Master 401(k) Plan | |
Eligibility period of service | 30 days |
Vesting percentage per year | 25% |
Employee Benefits - Summary of
Employee Benefits - Summary of SERPs and Defined Benefit Plans and Deferred Compensation Plan (Details) - USD ($) $ in Millions | 12 Months Ended | |||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2023 | |
Employee Benefits | ||||
Balances in Deferred Compensation Plan | $ 41.2 | $ 40.9 | ||
Value of assets for funding future payouts under the deferred compensation plan | 41.2 | 40.9 | ||
Contributions to Multiemployer Plans | 5.4 | 4.8 | $ 5.3 | |
Weighted average assumptions to determine benefit obligations | ||||
Deferred Compensation Plan expected employer contributions during 2023 | $ 2 | |||
Supplemental Executive Retirement Plans | ||||
Employee Benefits | ||||
Settlement losses related to payment of benefits | 2.3 | 6.7 | ||
Change in benefit obligation | ||||
Benefit obligation at beginning of year | 36.4 | 37.5 | ||
Service cost | 0.4 | 1 | 0.9 | |
Interest cost | 0.7 | 0.6 | 1 | |
Actuarial loss (gain) | (5.6) | (1.8) | ||
Benefits paid | (0.8) | (0.9) | ||
Plan settlements | (12.3) | |||
Benefit obligation at end of year | 18.8 | 36.4 | 37.5 | |
Funded status | ||||
Funded status of the plans | (18.8) | (36.4) | ||
Items not yet recognized as component of net periodic pension expense | ||||
Unrecognized net actuarial losses | 1.9 | 10.5 | ||
Accumulated other comprehensive loss | 1.9 | 10.5 | ||
Amounts recognized in the statement of financial position | ||||
Current liabilities | (0.8) | (12.9) | ||
Noncurrent liabilities | (18) | (23.5) | ||
Accumulated other comprehensive loss | 1.9 | 10.5 | ||
Net amount recognized | (16.9) | (25.9) | ||
Accumulated benefit obligation | 17.1 | 32.9 | ||
Components of net periodic benefit cost | ||||
Service cost | 0.4 | 1 | 0.9 | |
Interest cost | 0.7 | 0.6 | 1 | |
Settlement loss | 2.3 | 6.7 | ||
Amortization of net loss | 0.6 | 1.8 | 1.9 | |
Net periodic benefit cost | $ 4 | $ 3.4 | $ 10.5 | |
Weighted average assumptions to determine net cost | ||||
Discount rate (as a percent) | 2.17% | 1.64% | 2.63% | |
Rate of compensation increase (as a percent) | 6% | 6% | 6% | |
Weighted average assumptions to determine benefit obligations | ||||
Discount rate (as a percent) | 4.51% | 2.16% | ||
Rate of compensation increase (as a percent) | 6% | 6% | ||
Expected employer contributions during 2023 | $ 0.8 | |||
Defined Benefit Plans | ||||
Change in benefit obligation | ||||
Benefit obligation at beginning of year | 74.5 | $ 76.3 | ||
Service cost | 2 | 2.2 | $ 2.1 | |
Interest cost | 2 | 1.8 | 2.6 | |
Actuarial loss (gain) | (21) | (3.6) | ||
Benefits paid | (2.5) | (2.2) | ||
Benefit obligation at end of year | 55 | 74.5 | 76.3 | |
Change in plan assets | ||||
Fair value of plan assets at beginning of year | 70.9 | 63.9 | ||
Actual return on plan assets | (11.7) | 9.2 | ||
Benefits paid | (2.5) | (2.2) | ||
Fair value of plan assets at end of year | 56.7 | 70.9 | 63.9 | |
Funded status | ||||
Funded status of the plans | 1.7 | (3.6) | ||
Items not yet recognized as component of net periodic pension expense | ||||
Unrecognized net actuarial losses | 0.5 | 5.6 | ||
Unamortized prior service cost | 2.8 | 3.4 | ||
Accumulated other comprehensive loss | 3.3 | 9 | ||
Amounts recognized in the statement of financial position | ||||
Noncurrent assets | 1.7 | |||
Noncurrent liabilities | (3.6) | |||
Accumulated other comprehensive loss | 3.3 | 9 | ||
Net amount recognized | 5 | 5.4 | ||
Information for defined benefit plans with an accumulated benefit obligation and projected benefit obligation in excess of plan assets | ||||
Accumulated benefit obligation | 74.5 | |||
Fair value of plan assets | 70.9 | |||
Components of net periodic benefit cost | ||||
Service cost | 2 | 2.2 | 2.1 | |
Interest cost | 2 | 1.8 | 2.6 | |
Expected return on plan assets | (4.2) | (3.9) | (4.4) | |
Settlement loss | 12.7 | |||
Prior service (credit) cost | 0.5 | 0.6 | 0.6 | |
Amortization of net loss | 0.8 | 1.1 | ||
Net periodic benefit cost | $ 0.3 | $ 1.5 | $ 14.7 | |
Weighted average assumptions to determine net cost | ||||
Discount rate (as a percent) | 2.70% | 2.40% | 2.85% | |
Expected long-term rate of return on plan assets (as a percent) | 6% | 6.25% | 6.25% | |
Weighted average assumptions to determine benefit obligations | ||||
Discount rate (as a percent) | 5% | 2.70% | ||
Expected long-term rate of return on plan assets (as a percent) | 6% | 6.25% | ||
Expected employer contributions during 2023 | $ 0 | |||
Warehouse, delivery, selling, general and administrative expense | Supplemental Executive Retirement Plans | ||||
Components of net periodic benefit cost | ||||
Net periodic benefit cost | 0.4 | $ 1 | $ 0.9 | |
Warehouse, delivery, selling, general and administrative expense | Defined Benefit Plans | ||||
Components of net periodic benefit cost | ||||
Net periodic benefit cost | 2 | 2.2 | 2.1 | |
Other (income) expense, net | Supplemental Executive Retirement Plans | ||||
Components of net periodic benefit cost | ||||
Net periodic benefit cost | 3.6 | 2.4 | 9.6 | |
Other (income) expense, net | Defined Benefit Plans | ||||
Components of net periodic benefit cost | ||||
Net periodic benefit cost | $ (1.7) | $ (0.7) | $ 12.6 |
Employee Benefits - Defined Ben
Employee Benefits - Defined Benefit Plan Termination (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2020 | |
Employee Benefits | ||
Settlement loss | $ 2.3 | $ 19.4 |
Frozen Defined Benefit Plan | ||
Employee Benefits | ||
Settlement loss | $ 12.7 |
Employee Benefits - Plan Assets
Employee Benefits - Plan Assets and Investment Policy (Details) - USD ($) $ in Millions | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 |
Employee Benefits | |||
Weighted-average asset allocations (as a percent) | 100% | 100% | |
Defined Benefit Plans | |||
Employee Benefits | |||
Total investments at fair value | $ 56.7 | $ 70.9 | $ 63.9 |
Defined Benefit Plans | Level 1 | |||
Employee Benefits | |||
Total investments at fair value | 46.1 | 60.9 | |
Defined Benefit Plans | Level 2 | |||
Employee Benefits | |||
Total investments at fair value | 10.6 | 10 | |
Defined Benefit Plans | Common stock. | |||
Employee Benefits | |||
Fair value of plan assets | 31.4 | 39 | |
Defined Benefit Plans | Common stock. | Level 1 | |||
Employee Benefits | |||
Fair value of plan assets | 31.4 | 39 | |
Defined Benefit Plans | U.S. government, state, and agency | |||
Employee Benefits | |||
Fair value of plan assets | 6 | 5.1 | |
Defined Benefit Plans | U.S. government, state, and agency | Level 2 | |||
Employee Benefits | |||
Fair value of plan assets | 6 | 5.1 | |
Defined Benefit Plans | Corporate debt securities | |||
Employee Benefits | |||
Fair value of plan assets | 4.6 | 4.9 | |
Defined Benefit Plans | Corporate debt securities | Level 2 | |||
Employee Benefits | |||
Fair value of plan assets | 4.6 | 4.9 | |
Defined Benefit Plans | Mutual funds | |||
Employee Benefits | |||
Fair value of plan assets | 12.6 | 20.6 | |
Defined Benefit Plans | Mutual funds | Level 1 | |||
Employee Benefits | |||
Fair value of plan assets | 12.6 | 20.6 | |
Defined Benefit Plans | Interest bearing cash | |||
Employee Benefits | |||
Fair value of plan assets | 2.1 | 1.3 | |
Defined Benefit Plans | Interest bearing cash | Level 1 | |||
Employee Benefits | |||
Fair value of plan assets | $ 2.1 | $ 1.3 | |
Common stock. | |||
Employee Benefits | |||
Weighted-average asset allocations (as a percent) | 58% | 66% | |
Debt securities | |||
Employee Benefits | |||
Weighted-average asset allocations (as a percent) | 38% | 32% | |
Interest bearing cash | |||
Employee Benefits | |||
Weighted-average asset allocations (as a percent) | 4% | 2% |
Employee Benefits - Postretirem
Employee Benefits - Postretirement Plan and Summary Information for All Defined Benefit Plans (Details) $ in Millions | Dec. 31, 2022 USD ($) |
Supplemental Executive Retirement Plans | |
Summary of benefit payments under the Company's various defined benefit plans, which reflect expected future employee service, as appropriate, expected to be paid in the future periods | |
2023 | $ 0.8 |
2024 | 0.8 |
2025 | 0.8 |
2026 | 0.8 |
2027 | 1.2 |
2028-2032 | 20.7 |
Defined Benefit Plans | |
Summary of benefit payments under the Company's various defined benefit plans, which reflect expected future employee service, as appropriate, expected to be paid in the future periods | |
2023 | 2.6 |
2024 | 2.7 |
2025 | 2.9 |
2026 | 3.1 |
2027 | 3.2 |
2028-2032 | $ 18 |
Employee Benefits - Supplementa
Employee Benefits - Supplemental Bonus Plan (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Contributions to Company Sponsored Retirement Plans | |||
Company's expense for Reliance-sponsored retirement plans | $ 45.6 | $ 43 | $ 53 |
Master 401(k) Plan | |||
Contributions to Company Sponsored Retirement Plans | |||
Company's expense for Reliance-sponsored retirement plans | 28.1 | 25.6 | 21.2 |
Precision Strip Retirement and Savings Plan | |||
Contributions to Company Sponsored Retirement Plans | |||
Company's expense for Reliance-sponsored retirement plans | 9.2 | 8 | 5.2 |
Supplemental Executive Retirement Plans | |||
Contributions to Company Sponsored Retirement Plans | |||
Company's expense for Reliance-sponsored retirement plans | 4 | 3.4 | 10.5 |
Deferred Compensation Plan | |||
Contributions to Company Sponsored Retirement Plans | |||
Company's expense for Reliance-sponsored retirement plans | 2 | 2.5 | (0.3) |
Other Defined Contribution Plans | |||
Contributions to Company Sponsored Retirement Plans | |||
Company's expense for Reliance-sponsored retirement plans | 2 | 2 | 1.7 |
Defined Benefit Plans | |||
Contributions to Company Sponsored Retirement Plans | |||
Company's expense for Reliance-sponsored retirement plans | $ 0.3 | $ 1.5 | $ 14.7 |
Equity - Reincorporation, Commo
Equity - Reincorporation, Common Stock (Details) | 1 Months Ended | 12 Months Ended | ||||||
Feb. 28, 2023 $ / shares | Feb. 28, 2022 $ / shares | Feb. 28, 2021 $ / shares | Feb. 29, 2020 $ / shares | Feb. 28, 2019 $ / shares | Dec. 31, 2022 item $ / shares | Dec. 31, 2021 $ / shares | Dec. 31, 2020 $ / shares | |
Common Stock | ||||||||
The number of consecutive years the company has paid regular common stock quarterly dividends. | 63 | |||||||
Votes per share of common stock | 1 | |||||||
Common stock quarterly dividend per share (in dollars per share) | $ / shares | $ 1 | $ 0.875 | $ 0.6875 | $ 0.625 | $ 0.55 | $ 3.50 | $ 2.75 | $ 2.50 |
Equity - Share Repurchase Plan,
Equity - Share Repurchase Plan, Preferred Stock (Details) $ / shares in Units, $ in Millions | 12 Months Ended | |||
Dec. 31, 2022 USD ($) item $ / shares shares | Dec. 31, 2021 USD ($) item $ / shares shares | Dec. 31, 2020 USD ($) $ / shares shares | Jul. 26, 2022 USD ($) | |
Share Repurchase Plan | ||||
Value of shares authorized by the Board of Directors to be repurchased under share repurchase plan | $ | $ 1,000 | |||
Remaining value of shares authorized by the Board of Directors to be repurchased under share repurchase plan | $ | $ 680.7 | |||
Repurchase of common shares (in shares) | 3,525,000 | 2,107,000 | 3,674,000 | |
Average costs per share | $ / shares | $ 178.81 | $ 153.55 | $ 91.80 | |
Value of shares repurchased | $ | $ 630.3 | $ 323.5 | $ 337.3 | |
Preferred Stock | ||||
Preferred stock, authorized shares | 5,000,000 | 5,000,000 | ||
Preferred stock, par value (in dollars per share) | $ / shares | $ 0.001 | $ 0.001 | ||
Preferred stock, issued shares | 0 | 0 | ||
Preferred stock, outstanding shares | 0 | 0 | ||
Minimum number of series in which preferred shares may be issued | item | 1 | 1 | ||
Issued and outstanding common shares, beginning balance (in shares) | 61,806,000 | 63,600,000 | 66,854,000 | |
Issued to settle RSUs and PSUs, net of withheld shares (in shares) | 506,000 | 313,000 | 414,000 | |
Issued for stock options exercised (in shares) | 6,000 | |||
Repurchased (in shares) | (3,525,000) | (2,107,000) | (3,674,000) | |
Issued and outstanding common shares, ending balance (in shares) | 58,787,000 | 61,806,000 | 63,600,000 |
Equity - Accumulated Other Comp
Equity - Accumulated Other Comprehensive Loss (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Schedule of accumulated other comprehensive loss | ||
Balance at the beginning of the period | $ (68.9) | |
Current-year change | (17.4) | |
Balance at the end of the period | (86.3) | |
Deferred tax assets in accumulated other comprehensive loss, pension liabilities | 1.3 | $ 3.3 |
Income tax portion attributable to settlement of Reliance SERP | 0.3 | |
Foreign Currency Translation Loss | ||
Schedule of accumulated other comprehensive loss | ||
Balance at the beginning of the period | (55.2) | |
Current-year change | (28.8) | |
Balance at the end of the period | (84) | |
Pension and Postretirement Benefit Plan Adjustments, Net of Tax | ||
Schedule of accumulated other comprehensive loss | ||
Balance at the beginning of the period | (13.7) | |
Current-year change | 11.4 | |
Balance at the end of the period | $ (2.3) |
Other Expense (Income), net (De
Other Expense (Income), net (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Significant components of Other (Income) Expense, net | |||
Other expense, net | $ 14.2 | $ 3.1 | $ 24.7 |
Investment income from life insurance policies | |||
Significant components of Other (Income) Expense, net | |||
Other expense, net | (85.2) | (84.6) | (79.3) |
Interest expense on life insurance policy loans | |||
Significant components of Other (Income) Expense, net | |||
Other expense, net | 91.6 | 85.5 | 79.4 |
Life insurance policy cost of insurance | |||
Significant components of Other (Income) Expense, net | |||
Other expense, net | 15.7 | 14.4 | 13.4 |
Income from life insurance policy redemptions | |||
Significant components of Other (Income) Expense, net | |||
Other expense, net | (6.6) | (6.2) | (4.6) |
Foreign currency transaction (losses) gains | |||
Significant components of Other (Income) Expense, net | |||
Other expense, net | 6.2 | 4 | 2.3 |
Net periodic benefit cost - settlement loss | |||
Significant components of Other (Income) Expense, net | |||
Other expense, net | 2.3 | 19.4 | |
Net periodic benefit cost - components other than service cost and settlement loss | |||
Significant components of Other (Income) Expense, net | |||
Other expense, net | (0.4) | 1.7 | 2.8 |
Loss (income) on deferred compensation plan assets | |||
Significant components of Other (Income) Expense, net | |||
Other expense, net | 6.9 | (4.1) | (4.3) |
Interest income | |||
Significant components of Other (Income) Expense, net | |||
Other expense, net | (9.3) | (1.1) | (0.9) |
All other, net | |||
Significant components of Other (Income) Expense, net | |||
Other expense, net | $ (7) | $ (6.5) | $ (3.5) |
Commitments and Contingencies -
Commitments and Contingencies - Purchase Commitments (Details) - Aerospace materials $ in Millions | Dec. 31, 2022 USD ($) |
Purchase Commitments | |
Total amount of purchase commitments | $ 320.1 |
2023 | 179.1 |
2024 | 44.9 |
Thereafter | $ 96.1 |
Commitments and Contingencies_2
Commitments and Contingencies - Collective Bargaining Agreements and Environmental Contingencies (Details) | 12 Months Ended |
Dec. 31, 2022 item location employee | |
Employees covered by collective bargaining agreements | |
Collective Bargaining Agreements | |
Number of Location Entity Operates | location | 52 |
Total employees | Employees covered by collective bargaining agreements | |
Collective Bargaining Agreements | |
Percentage of employees covered by collective bargaining agreements | 13% |
Number of employees | employee | 1,900 |
Number of collective bargaining agreements that expire over the next five years | item | 61 |
Expiration period of collective bargaining agreements | 5 years |
Employees covered by collective bargaining agreements that expire during 2023 | |
Collective Bargaining Agreements | |
Number of employees | employee | 500 |
Number of collective bargaining agreements that expire within one year | item | 23 |
Earnings Per Share (Details)
Earnings Per Share (Details) - USD ($) $ / shares in Units, $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Numerator: | |||
Net income attributable to Reliance | $ 1,840.1 | $ 1,413 | $ 369.1 |
Denominator: | |||
Weighted average shares outstanding (in shares) | 60,559,000 | 63,217,000 | 64,328,000 |
Dilutive effect of stock-based awards (in shares) | 936,000 | 1,110,000 | 935,000 |
Weighted average diluted shares outstanding (in shares) | 61,495,000 | 64,327,000 | 65,263,000 |
Earnings per share attributable to Reliance stockholders - basic (in dollars per share) | $ 30.39 | $ 22.35 | $ 5.74 |
Earnings per share attributable to Reliance stockholders - diluted (in dollars per share) | $ 29.92 | $ 21.97 | $ 5.66 |
Diluted shares | |||
Weighted average shares, respectively, for RSU's, not included in the diluted calculation due to their anti-dilutive effect | 83,857 | 116,206 | 183,508 |
Segment Information - Summary o
Segment Information - Summary of sales by product and service (Details) | 12 Months Ended | ||
Dec. 31, 2022 item segment | Dec. 31, 2021 segment item | Dec. 31, 2020 item segment | |
Segment Information | |||
Number of reportable segments | item | 1 | 1 | 1 |
Number of operating segments | segment | 1 | 1 | 1 |
Sales (as a percent) | 100% | 100% | 100% |
Carbon steel | |||
Segment Information | |||
Sales (as a percent) | 54% | 58% | 51% |
Stainless steel | |||
Segment Information | |||
Sales (as a percent) | 17% | 16% | 16% |
Aluminum | |||
Segment Information | |||
Sales (as a percent) | 15% | 14% | 19% |
Alloy | |||
Segment Information | |||
Sales (as a percent) | 4% | 4% | 5% |
Toll processing and logistics | |||
Segment Information | |||
Sales (as a percent) | 3% | 3% | 4% |
Copper and brass | |||
Segment Information | |||
Sales (as a percent) | 2% | 1% | 1% |
Other and eliminations | |||
Segment Information | |||
Sales (as a percent) | 5% | 4% | 4% |
Segment Information - Geographi
Segment Information - Geographic Location (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Consolidated financial information of the Company's operations by geographic location | |||
Net sales | $ 17,025 | $ 14,093.3 | $ 8,811.9 |
Long-lived assets | 5,443.3 | 5,375.9 | 4,994 |
United States | |||
Consolidated financial information of the Company's operations by geographic location | |||
Net sales | 15,978.6 | 13,371.7 | 8,180.7 |
Long-lived assets | 5,051.9 | 4,971.2 | 4,709.1 |
Foreign Countries | |||
Consolidated financial information of the Company's operations by geographic location | |||
Net sales | 1,046.4 | 721.6 | 631.2 |
Long-lived assets | $ 391.4 | $ 404.7 | $ 284.9 |
Impairment and Restructuring _3
Impairment and Restructuring Charges (Details) - USD ($) | 3 Months Ended | 12 Months Ended | ||
Mar. 31, 2020 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Impairment and Restructuring Charge | ||||
Intangible assets, net | $ 4,700,000 | $ 98,500,000 | ||
Property, plant and equipment | $ 0 | 0 | 9,300,000 | |
Operating lease right-of-use assets | 200,000 | |||
Total impairment charges | 4,700,000 | 108,000,000 | ||
Total impairment and restructuring charge | $ 137,500,000 | 1,400,000 | 4,800,000 | 157,800,000 |
Cost of sales | ||||
Impairment and Restructuring Charge | ||||
Restructuring | 38,200,000 | |||
Warehouse, delivery, selling, general and administrative expense | ||||
Impairment and Restructuring Charge | ||||
Restructuring | $ 1,400,000 | $ 100,000 | $ 11,600,000 |
SCHEDULE II - VALUATION AND Q_2
SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS (Details) - Allowance for doubtful accounts - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Movement in valuation and qualifying accounts | |||
Balance at Beginning of Year | $ 26.7 | $ 19 | $ 17.8 |
Additions Charged to Costs and Expenses | 3.4 | 9.8 | 5.8 |
Deductions | 4 | 2.8 | 4.6 |
Amounts Charged to Other Accounts | 0.7 | ||
Balance at End of Year | $ 26.1 | $ 26.7 | $ 19 |