Reliance Steel & Aluminum (RS) 10-Q4 May 232023 Q1 Quarterly reportFinancial data

Company Profile

Document and Entity Information

Document and Entity Information - shares	3 Months Ended
Document and Entity Information - shares	Mar. 31, 2023	Apr. 28, 2023
Cover Abstract
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Mar. 31, 2023
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 Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		58,793,188
Entity Central Index Key	0000861884
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2023
Document Fiscal Period Focus	Q1
Amendment Flag	false

CONSOLIDATED BALANCE SHEETS

CONSOLIDATED BALANCE SHEETS - USD ($) $ in Millions	Mar. 31, 2023	Dec. 31, 2022
Current assets:
Cash and cash equivalents	$ 816.2	$ 1,173.4
Accounts receivable, less allowance for credit losses of $28.7 at March 31, 2023 and $26.1 at December 31, 2022	1,800.3	1,565.7
Inventories	1,981.4	1,995.3
Prepaid expenses and other current assets	114.2	115.6
Income taxes receivable		36.6
Total current assets	4,712.1	4,886.6
Property, plant and equipment:
Land	263.3	262.7
Buildings	1,381	1,359.3
Machinery and equipment	2,507.9	2,446.9
Accumulated depreciation	(2,127.4)	(2,094.3)
Property, plant and equipment, net	2,024.8	1,974.6
Operating lease right-of-use assets	217.3	216.4
Goodwill	2,106.1	2,105.9
Intangible assets, net	1,008	1,019.6
Cash surrender value of life insurance policies, net	37.6	42
Other assets	97.3	84.8
Total assets	10,203.2	10,329.9
Current liabilities:
Accounts payable	545	412.4
Accrued expenses	113.7	118.8
Accrued compensation and retirement benefits	143.7	240
Accrued insurance costs	45.2	43.4
Current maturities of long-term debt and short-term borrowings	8.2	508.2
Current maturities of operating lease liabilities	53.2	52.5
Income taxes payable	66.4
Total current liabilities	975.4	1,375.3
Long-term debt	1,140.2	1,139.4
Operating lease liabilities	165.5	165.2
Long-term retirement benefits	29.6	26.1
Other long-term liabilities	61.9	51.4
Deferred income taxes	476.2	476.6
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-58,840 at March 31, 2023 and 58,787 at December 31, 2022	0.1	0.1
Retained earnings	7,432.1	7,173.6
Accumulated other comprehensive loss	(86.5)	(86.3)
Total Reliance stockholders' equity	7,345.7	7,087.4
Noncontrolling interests	8.7	8.5
Total equity	7,354.4	7,095.9
Total liabilities and equity	$ 10,203.2	$ 10,329.9

CONSOLIDATED BALANCE SHEETS (Pa

CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) shares in Thousands, $ in Millions	Mar. 31, 2023	Dec. 31, 2022
CONSOLIDATED BALANCE SHEETS
Accounts receivable, allowance for credit losses	$ 28.7	$ 26.1
Preferred stock, par value (in dollars per share)	$ 0.001	$ 0.001
Preferred stock, Authorized shares	5,000	5,000
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	200,000
Common stock, Issued shares	58,840	58,787
Common stock, outstanding shares	58,840	58,787

CONSOLIDATED STATEMENTS OF INCO

CONSOLIDATED STATEMENTS OF INCOME - USD ($) shares in Thousands, $ in Millions	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
CONSOLIDATED STATEMENTS OF INCOME
Net sales	$ 3,965.3	$ 4,485.8
Costs and expenses:
Cost of sales (exclusive of depreciation and amortization shown below)	2,739.3	3,098.7
Warehouse, delivery, selling, general and administrative ("SG&A")	651.3	611.9
Depreciation and amortization	61.1	59.1
Total costs and expenses	3,451.7	3,769.7
Operating income	513.6	716.1
Other (income) expense:
Interest expense	10.9	15.6
Other (income) expense, net	(5.8)	3.3
Income before income taxes	508.5	697.2
Income tax provision	124.1	172.6
Net income	384.4	524.6
Less: net income attributable to noncontrolling interests	1.3	1.3
Net income attributable to Reliance	$ 383.1	$ 523.3
Earnings per share attributable to Reliance stockholders:
Basic (in dollars per share)	$ 6.51	$ 8.46
Diluted (in dollars per share)	$ 6.43	$ 8.33
Shares used in computing earnings per share:
Basic (in shares)	58,832	61,833
Diluted (in shares)	59,534	62,784

CONSOLIDATED STATEMENTS OF COMP

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
Net income	$ 384.4	$ 524.6
Other comprehensive income (loss):
Foreign currency translation gain	0.6	0.7
Postretirement benefit plan adjustments, net of tax	(0.8)	(0.1)
Total other comprehensive (loss) income	(0.2)	0.6
Comprehensive income	384.2	525.2
Less: comprehensive income attributable to noncontrolling interests	1.3	1.3
Comprehensive income attributable to Reliance	$ 382.9	$ 523.9

CONSOLIDATED STATEMENTS OF EQUI

CONSOLIDATED STATEMENTS OF EQUITY - USD ($) $ in Millions	Reliance Stockholders'	Common Stock and Additional Paid in Capital	Retained Earnings	Accumulated Other Comprehensive Loss	Non-controlling Interests	Total
Balances at Dec. 31, 2021		$ 0.1	$ 6,155.3	$ (68.9)	$ 7.2	$ 6,093.7
Increase (Decrease) in Stockholders' Equity
Net income attributable to Reliance			523.3			523.3
Cash dividends and dividend equivalents			(56.7)
Other comprehensive (loss) income				0.6		0.6
Comprehensive income					1.3	1.3
Dividends paid					(1.1)
Stock-based compensation		11.8
Taxes paid related to net share settlement of restricted stock units		(17.1)
Repurchase of common shares		5.3	(22.4)			(17.1)
Balances at Mar. 31, 2022	$ 6,531.3	0.1	6,599.5	(68.3)	7.4	6,538.7
Balances at Dec. 31, 2022		0.1	7,173.6	(86.3)	8.5	7,095.9
Increase (Decrease) in Stockholders' Equity
Net income attributable to Reliance			383.1			383.1
Cash dividends and dividend equivalents			(62)
Other comprehensive (loss) income				(0.2)		(0.2)
Comprehensive income					1.3	1.3
Dividends paid					(1.1)
Stock-based compensation		13.5
Taxes paid related to net share settlement of restricted stock units		(37.2)
Repurchase of common shares		23.7	(62.6)			(38.9)
Balances at Mar. 31, 2023	$ 7,345.7	$ 0.1	$ 7,432.1	$ (86.5)	$ 8.7	$ 7,354.4

CONSOLIDATED STATEMENTS OF EQ_2

CONSOLIDATED STATEMENTS OF EQUITY (Parenthetical) - $ / shares	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
CONSOLIDATED STATEMENTS OF EQUITY
Cash dividends declared per common share (in dollars per share)	$ 1	$ 0.875

CONSOLIDATED STATEMENTS OF CASH

CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Operating activities:
Net income	$ 384.4	$ 524.6
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization expense	61.1	59.1
Stock-based compensation expense	13.5	11.8
Other	(0.1)	8
Changes in operating assets and liabilities (excluding effect of businesses acquired):
Accounts receivable	(237.1)	(399.6)
Inventories	13.5	54
Prepaid expenses and other assets	50	19.5
Accounts payable and other liabilities	99.3	126.6
Net cash provided by operating activities	384.6	404
Investing activities:
Purchases of property, plant and equipment	(102.9)	(66.7)
Proceeds from sales of property, plant and equipment	8.3	8.2
Deferred compensation plan contributions, net	(7.4)	(7.5)
Other	(0.6)	2.7
Net cash used in investing activities	(102.6)	(63.3)
Financing activities:
Principal payment on long-term debt	(500)
Cash dividends and dividend equivalents	(62)	(56.7)
Share repurchases	(38.9)	(17.1)
Taxes paid related to net share settlement of restricted stock units	(37.2)	(17.1)
Other	(1.1)	(1.1)
Net cash used in financing activities	(639.2)	(92)
Effect of exchange rate changes on cash and cash equivalents		(1.2)
(Decrease) increase in cash and cash equivalents	(357.2)	247.5
Cash and cash equivalents at beginning of year	1,173.4	300.5
Cash and cash equivalents at end of the period	816.2	548
Supplemental cash flow information:
Interest paid during the period	14.4	9.6
Income taxes paid during the period, net	$ 21.2	$ 89.8

Summary of Significant Accounti

Summary of Significant Accounting Policies	3 Months Ended
Summary of Significant Accounting Policies	Mar. 31, 2023
Summary of Significant Accounting Policies
Summary of Significant Accounting Policies	Note 1. Summary of Significant Accounting Policies Principles of Consolidation The accompanying unaudited consolidated financial statements include the accounts of Reliance Steel & Aluminum Co. and its subsidiaries (collectively “Reliance”, the “Company”, “we”, “our” or “us”). These financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”) for interim financial information and with the instructions of Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of management, the consolidated financial statements reflect all material adjustments, which are of a normal recurring nature, necessary for presentation of financial statements for interim periods in accordance with U.S. GAAP. Interim results are not necessarily indicative of the results for a full year. All significant intercompany accounts and transactions have been eliminated. The ownership of the other interest holders of consolidated subsidiaries is reflected as noncontrolling interests. Investments in unconsolidated subsidiaries are recorded under the equity method of accounting. These consolidated financial statements and accompanying notes should be read in conjunction with the consolidated financial statements and accompanying notes included in Reliance’s Annual Report on Form 10-K for the fiscal year ended December 31, 2022. The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts and the disclosure of contingent amounts in our consolidated financial statements and the accompanying notes. The Company bases its estimates on historical experience and on various other assumptions that the Company believes to be reasonable under the circumstances. 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. We estimate the effect of LIFO on interim periods by allocating the projected year-end LIFO calculation to interim periods on a pro rata basis.

Revenues

Revenues	3 Months Ended
Revenues	Mar. 31, 2023
Revenues.
Revenues	Note 2. Revenues The following table presents our net sales disaggregated by product and service: Three Months Ended March 31, 2023 2022 (in millions) Carbon steel $ 2,128.5 $ 2,547.5 Aluminum 670.2 692.8 Stainless steel 657.3 764.9 Alloy 191.4 183.7 Toll processing and logistics 155.4 135.1 Copper and brass 82.0 86.6 Other and eliminations 80.5 75.2 Total $ 3,965.3 $ 4,485.8

Goodwill

Goodwill	3 Months Ended
Goodwill	Mar. 31, 2023
Goodwill.
Goodwill	Note 3. Goodwill The change in the carrying amount of goodwill is as follows: (in millions) Balance at January 1, 2023 $ 2,105.9 Effect of foreign currency translation 0.2 Balance at March 31, 2023 $ 2,106.1 We had no accumulated impairment losses related to goodwill at March 31, 2023 and December 31, 2022.

Intangible Assets, net

Intangible Assets, net	3 Months Ended
Intangible Assets, net	Mar. 31, 2023
Intangible Assets, net
Intangible Assets, net	Note 4. Intangible Assets, net Intangible assets, net consisted of the following: March 31, 2023 December 31, 2022 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 $ 713.8 $ (490.5) $ 713.6 $ (479.3) Backlog of orders 7.9 22.3 (3.8) 22.3 (3.1) Other 9.2 9.9 (9.5) 9.9 (9.5) 746.0 (503.8) 745.8 (491.9) Intangible assets not subject to amortization: Trade names 765.8 — 765.7 — $ 1,511.8 $ (503.8) $ 1,511.5 $ (491.9) Amortization expense for intangible assets was $11.8 million and $12.2 million for the first quarters of 2023 and 2022, respectively. Foreign currency translation gains related to intangible assets, net were $0.2 million and $0.4 million for the first quarters of 2023 and 2022, respectively. The following is a summary of estimated future amortization expense: (in millions) 2023 (remaining nine months) $ 31.8 2024 40.1 2025 35.9 2026 26.4 2027 25.8 Thereafter 82.2 $ 242.2

Debt

Debt	3 Months Ended
Debt	Mar. 31, 2023
Debt
Debt	Note 5. Debt Debt consisted of the following: March 31, December 31, 2023 2022 (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 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 9.6 Total 1,159.6 1,659.6 Less: unamortized discount and debt issuance costs (11.2) (12.0) Less: amounts due within one year and short-term borrowings (8.2) (508.2) Total long-term debt $ 1,140.2 $ 1,139.4 The weighted average interest rate on the Company’s outstanding borrowings as of March 31, 2023 and December 31, 2022 was 2.89% and 3.37%, respectively. 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”). As of March 31, 2023, 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 March 31, 2023 and December 31, 2022, we had no outstanding borrowings on the revolving credit facility. As of March 31, 2023 and December 31, 2022, we had $7.7 million of letters of credit outstanding under the revolving credit facility. Senior Unsecured Notes On January 15, 2023, we redeemed in full the $500.0 million aggregate outstanding principal amount of our 4.50% senior notes due April 15, 2023 using cash on hand. Under the indentures for each series of our senior notes (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 interes Other Notes, Revolving Credit and Letter of Credit/Letters of Guarantee Facilities A revolving credit facility with a credit limit of $7.9 million is in place for an operation in Asia with an outstanding balance of $2.2 million as of March 31, 2023 and December 31, 2022. Various industrial revenue bonds had combined outstanding balances of $7.4 million as of March 31, 2023 and December 31, 2022 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 March 31, 2023, a total of $19.5 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 maintenance covenants in our Credit Agreement at March 31, 2023.

Leases

Leases	3 Months Ended
Leases	Mar. 31, 2023
Leases
Leases	Note 6. 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 of less than $1.0 million. The following is a summary of our lease cost: Three Months Ended March 31, 2023 2022 (in millions) Operating lease cost $ 23.6 $ 23.0 Supplemental cash flow and balance sheet information is presented below: Three Months Ended March 31, 2023 2022 (in millions) Supplemental cash flow information: Cash payments for operating leases $ 23.5 $ 21.8 Right-of-use assets obtained in exchange for operating lease obligations $ 15.6 $ 7.1 March 31, December 31, 2023 2022 Other lease information: Weighted average remaining lease term—operating leases 6.5 years 6.6 years Weighted average discount rate—operating leases 3.9% 3.8% Maturities of operating lease liabilities as of March 31, 2023 are as follows: (in millions) 2023 (remaining nine months) $ 46.3 2024 52.7 2025 39.9 2026 27.6 2027 19.6 Thereafter 68.5 Total operating lease payments 254.6 Less: imputed interest (35.9) Total operating lease liabilities $ 218.7

Income Taxes

Income Taxes	3 Months Ended
Income Taxes	Mar. 31, 2023
Income Taxes
Income Taxes	Note 7. Income Taxes Our effective income tax rates for the first quarters of 2023 and 2022 were 24.4% and 24.8%, respectively. The differences between our effective income tax rates and the U.S. federal statutory rate of 21.0% were mainly due to state income taxes and higher foreign income tax rates, partially offset by the effects of company-owned life insurance policies.

Equity

Equity	3 Months Ended
Equity	Mar. 31, 2023
Equity
Equity	Note 8. Equity Dividends On April 25, 2023, our Board of Directors declared the 2023 second quarter cash dividend of $1.00 per share of common stock, payable on June 9, 2023 to stockholders of record as of May 26, 2023. During the first quarters of 2023 and 2022, we declared and paid quarterly dividends of $1.00 and $0.875 per share, or $59.0 million and $54.2 million in total, respectively. In addition, we paid $3.0 million and $2.5 million in dividend equivalents with respect to vested restricted stock units during the first quarters of 2023 and 2022, respectively. Stock-Based Compensation We make annual grants of long-term incentive awards to officers and key employees under our Second Amended and Restated 2015 Incentive Award Plan We also grant the non-management members of our Board of Directors fully vested stock awards under our Directors Equity Plan In the first quarters of 2023 and 2022, we made payments of $37.2 million and $17.1 million, respectively, to tax authorities on our employees’ behalf for shares withheld related to net share settlement of vested restricted stock units. The following is a summary of changes in our unvested RSUs and PSUs during the first quarter of 2023: Weighted Average RSU and PSU Grant Date Aggregate Units Fair Value Unvested at January 1, 2023 582,012 $ 164.60 Granted (1) 193,812 247.90 Vested (870) 152.93 Cancelled or forfeited (2,002) 170.84 Unvested at March 31, 2023 772,952 $ 185.48 Shares reserved for future grants (all plans) 1,457,448 (1) Comprised of 109,683 RSUs and 84,129 PSUs granted in February 2023. The service-based RSUs cliff vest on December 1, 2025 and the performance-based RSUs are subject to a 3 -year performance period ending December 31, 2025. As of March 31, 2023, there was $123.9 million of total unrecognized compensation cost related to unvested RSUs and PSUs in an aggregate amount of 772,952 units that are expected to be settled through the issuance of 993,124 shares of our common stock. The unrecognized compensation cost is expected to be recognized over a weighted average period of 2.0 years. Share Repurchases Our share repurchase activity during the first quarters of 2023 and 2022 was as follows: 2023 2022 Average Cost Average Cost Shares Per Share Amount Shares Per Share Amount (in millions) (in millions) First quarter 160,224 $ 242.86 $ 38.9 113,529 $ 150.97 $ 17.1 On July 26, 2022, our Board of Directors amended our share repurchase program to increase the repurchase authorization to $1.0 billion. The share repurchase program does not obligate us to repurchase any specific number of shares, does not have a specific expiration date and may be suspended or discontinued at any time. Repurchased and subsequently retired shares are restored to the status of authorized but unissued shares. As of March 31, 2023, we had remaining authorization under the program to repurchase $641.8 million of our common stock 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. Accumulated Other Comprehensive Loss Accumulated other comprehensive loss included the following: Pension and Foreign Currency Postretirement Benefit Accumulated Other Translation Plan Adjustments, Comprehensive (Loss) Gain Net of Tax Loss (in millions) Balance as of January 1, 2023 $ (84.0) $ (2.3) $ (86.3) Current-period change 0.6 (0.8) (0.2) Balance as of March 31, 2023 $ (83.4) $ (3.1) $ (86.5) 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. 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 .

Commitments and Contingencies

Commitments and Contingencies	3 Months Ended
Commitments and Contingencies	Mar. 31, 2023
Commitments and Contingencies.
Commitments and Contingencies	Note 9. Commitments and Contingencies Environmental Contingencies We are currently involved with an environmental remediation project related to activities at former manufacturing operations of Earle M. Jorgensen Company (“EMJ”), our wholly owned 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 position, results of operations or cash flows. We maintain general liability insurance against risks arising in the ordinary course of business. Risks and Uncertainties We continue to monitor the impact of the COVID-19 pandemic, and government actions and measures taken to prevent its spread, and the potential to affect our operations. In addition to COVID-19, the conflict between Russia and Ukraine and macroeconomic disruptions such as inflation and the potential for an economic recession or slowdown could also significantly impact the demand for our products and services, as well as those of our customers and suppliers, and our estimates and judgments may be subject to greater volatility than in the past. Refer to Part I, Item 1A “Risk Factors” of our annual report on Form 10-K for the year ended December 31, 2022 for further discussion of risks that could adversely affect our estimates and judgments.

Earnings Per Share

Earnings Per Share	3 Months Ended
Earnings Per Share	Mar. 31, 2023
Earnings Per Share
Earnings Per Share	Note 10. Earnings Per Share The following table sets forth the computation of basic and diluted earnings per share: Three Months Ended March 31, 2023 2022 (in millions, except number of shares which are reflected in thousands and per share amounts) Numerator: Net income attributable to Reliance $ 383.1 $ 523.3 Denominator: Weighted average shares outstanding 58,832 61,833 Dilutive effect of stock-based awards 702 951 Weighted average diluted shares outstanding 59,534 62,784 Earnings per share attributable to Reliance stockholders: Basic $ 6.51 $ 8.46 Diluted $ 6.43 $ 8.33 The computations of earnings per share for the first quarters of 2023 and 2022 do not include 194,304 and 314,042 weighted average shares, respectively, in respect of outstanding RSUs and PSUs, because their inclusion would have been anti-dilutive.

Subsequent Event

Subsequent Event	3 Months Ended
Subsequent Event	Mar. 31, 2023
Subsequent Event
Subsequent Event	Note 11. Subsequent Event On May 1, 2023, we acquired Southern Steel Supply, LLC (“Southern Steel”), a metals service center that offers merchant and structural steel, pipe and tube, steel plate, ornamental products and laser cut and fabricated parts. Located in Memphis, Tennessee, Southern Steel will operate as a subsidiary of Siskin Steel & Supply Company, Inc., a wholly owned subsidiary of Reliance. The acquisition was funded with cash on hand. For the twelve months ended December 31, 2022, annual net sales for Southern Steel were $62.9 million.

Summary of Significant Accoun_2

Summary of Significant Accounting Policies (Policies)	3 Months Ended
Summary of Significant Accounting Policies (Policies)	Mar. 31, 2023
Summary of Significant Accounting Policies
Principles of Consolidation	Principles of Consolidation The accompanying unaudited consolidated financial statements include the accounts of Reliance Steel & Aluminum Co. and its subsidiaries (collectively “Reliance”, the “Company”, “we”, “our” or “us”). These financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”) for interim financial information and with the instructions of Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of management, the consolidated financial statements reflect all material adjustments, which are of a normal recurring nature, necessary for presentation of financial statements for interim periods in accordance with U.S. GAAP. Interim results are not necessarily indicative of the results for a full year. All significant intercompany accounts and transactions have been eliminated. The ownership of the other interest holders of consolidated subsidiaries is reflected as noncontrolling interests. Investments in unconsolidated subsidiaries are recorded under the equity method of accounting. These consolidated financial statements and accompanying notes should be read in conjunction with the consolidated financial statements and accompanying notes included in Reliance’s Annual Report on Form 10-K for the fiscal year ended December 31, 2022. The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts and the disclosure of contingent amounts in our consolidated financial statements and the accompanying notes. The Company bases its estimates on historical experience and on various other assumptions that the Company believes to be reasonable under the circumstances.
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. We estimate the effect of LIFO on interim periods by allocating the projected year-end LIFO calculation to interim periods on a pro rata basis.

Revenues (Tables)

Revenues (Tables)	3 Months Ended
Revenues (Tables)	Mar. 31, 2023
Revenues.
Schedule of disaggregation of revenue	Three Months Ended March 31, 2023 2022 (in millions) Carbon steel $ 2,128.5 $ 2,547.5 Aluminum 670.2 692.8 Stainless steel 657.3 764.9 Alloy 191.4 183.7 Toll processing and logistics 155.4 135.1 Copper and brass 82.0 86.6 Other and eliminations 80.5 75.2 Total $ 3,965.3 $ 4,485.8

Goodwill (Tables)

Goodwill (Tables)	3 Months Ended
Goodwill (Tables)	Mar. 31, 2023
Goodwill.
Schedule of changes in the carrying amount of goodwill	(in millions) Balance at January 1, 2023 $ 2,105.9 Effect of foreign currency translation 0.2 Balance at March 31, 2023 $ 2,106.1

Intangible Assets, net (Tables)

Intangible Assets, net (Tables)	3 Months Ended
Intangible Assets, net (Tables)	Mar. 31, 2023
Intangible Assets, net
Summary of intangible assets, net	March 31, 2023 December 31, 2022 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 $ 713.8 $ (490.5) $ 713.6 $ (479.3) Backlog of orders 7.9 22.3 (3.8) 22.3 (3.1) Other 9.2 9.9 (9.5) 9.9 (9.5) 746.0 (503.8) 745.8 (491.9) Intangible assets not subject to amortization: Trade names 765.8 — 765.7 — $ 1,511.8 $ (503.8) $ 1,511.5 $ (491.9)
Summary of estimated aggregate amortization expense	(in millions) 2023 (remaining nine months) $ 31.8 2024 40.1 2025 35.9 2026 26.4 2027 25.8 Thereafter 82.2 $ 242.2

Debt (Tables)

Debt (Tables)	3 Months Ended
Debt (Tables)	Mar. 31, 2023
Debt
Summary of debt	March 31, December 31, 2023 2022 (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 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 9.6 Total 1,159.6 1,659.6 Less: unamortized discount and debt issuance costs (11.2) (12.0) Less: amounts due within one year and short-term borrowings (8.2) (508.2) Total long-term debt $ 1,140.2 $ 1,139.4

Leases (Tables)

Leases (Tables)	3 Months Ended
Leases (Tables)	Mar. 31, 2023
Leases
Schedule of lease cost	Three Months Ended March 31, 2023 2022 (in millions) Operating lease cost $ 23.6 $ 23.0
Schedule of supplemental cash flow and other lease information	Three Months Ended March 31, 2023 2022 (in millions) Supplemental cash flow information: Cash payments for operating leases $ 23.5 $ 21.8 Right-of-use assets obtained in exchange for operating lease obligations $ 15.6 $ 7.1 March 31, December 31, 2023 2022 Other lease information: Weighted average remaining lease term—operating leases 6.5 years 6.6 years Weighted average discount rate—operating leases 3.9% 3.8%
Schedule of maturities of operating lease liabilities	(in millions) 2023 (remaining nine months) $ 46.3 2024 52.7 2025 39.9 2026 27.6 2027 19.6 Thereafter 68.5 Total operating lease payments 254.6 Less: imputed interest (35.9) Total operating lease liabilities $ 218.7

Equity (Tables)

Equity (Tables)	3 Months Ended
Equity (Tables)	Mar. 31, 2023
Equity
Summary of the status of the Company's restricted stock units and changes during the quarter	Weighted Average RSU and PSU Grant Date Aggregate Units Fair Value Unvested at January 1, 2023 582,012 $ 164.60 Granted (1) 193,812 247.90 Vested (870) 152.93 Cancelled or forfeited (2,002) 170.84 Unvested at March 31, 2023 772,952 $ 185.48 Shares reserved for future grants (all plans) 1,457,448 (1) Comprised of 109,683 RSUs and 84,129 PSUs granted in February 2023. The service-based RSUs cliff vest on December 1, 2025 and the performance-based RSUs are subject to a 3 -year performance period ending December 31, 2025.
Schedule of share repurchase activity	2023 2022 Average Cost Average Cost Shares Per Share Amount Shares Per Share Amount (in millions) (in millions) First quarter 160,224 $ 242.86 $ 38.9 113,529 $ 150.97 $ 17.1
Schedule of accumulated other comprehensive loss	Pension and Foreign Currency Postretirement Benefit Accumulated Other Translation Plan Adjustments, Comprehensive (Loss) Gain Net of Tax Loss (in millions) Balance as of January 1, 2023 $ (84.0) $ (2.3) $ (86.3) Current-period change 0.6 (0.8) (0.2) Balance as of March 31, 2023 $ (83.4) $ (3.1) $ (86.5)

Earnings Per Share (Tables)

Earnings Per Share (Tables)	3 Months Ended
Earnings Per Share (Tables)	Mar. 31, 2023
Earnings Per Share
Computation of basic and diluted earnings per share	Three Months Ended March 31, 2023 2022 (in millions, except number of shares which are reflected in thousands and per share amounts) Numerator: Net income attributable to Reliance $ 383.1 $ 523.3 Denominator: Weighted average shares outstanding 58,832 61,833 Dilutive effect of stock-based awards 702 951 Weighted average diluted shares outstanding 59,534 62,784 Earnings per share attributable to Reliance stockholders: Basic $ 6.51 $ 8.46 Diluted $ 6.43 $ 8.33

Revenues (Details)

Revenues (Details) - USD ($) $ in Millions	3 Months Ended
Revenues (Details) - USD ($) $ in Millions	Mar. 31, 2023	Mar. 31, 2022
Revenue Disaggregation
Revenue	$ 3,965.3	$ 4,485.8
Carbon steel
Revenue Disaggregation
Revenue	2,128.5	2,547.5
Aluminum
Revenue Disaggregation
Revenue	670.2	692.8
Stainless steel
Revenue Disaggregation
Revenue	657.3	764.9
Alloy
Revenue Disaggregation
Revenue	191.4	183.7
Toll processing and logistics
Revenue Disaggregation
Revenue	155.4	135.1
Copper and brass
Revenue Disaggregation
Revenue	82	86.6
Other and eliminations
Revenue Disaggregation
Revenue	$ 80.5	$ 75.2

Goodwill (Details)

Goodwill (Details) - USD ($) $ in Millions	3 Months Ended
Goodwill (Details) - USD ($) $ in Millions	Mar. 31, 2023	Dec. 31, 2022
Change in the carrying amount of goodwill
Balance at the beginning of the period	$ 2,105.9
Effect of foreign currency translation	0.2
Balance at the end of the period	2,106.1
Accumulated impairment losses	$ 0	$ 0

Intangible Assets, net (Details

Intangible Assets, net (Details) - USD ($) $ in Millions	3 Months Ended
Intangible Assets, net (Details) - USD ($) $ in Millions	Mar. 31, 2023	Mar. 31, 2022	Dec. 31, 2022
Intangible assets subject to amortization:
Intangible assets subject to amortization, Gross Carrying Amount	$ 746		$ 745.8
Intangible assets subject to amortization, Accumulated Amortization	(503.8)		(491.9)
Intangible assets
Intangible assets, Gross Carrying Amount	1,511.8		1,511.5
Amortization expense for intangible assets	11.8	$ 12.2
Changes in intangible assets due to foreign currency translation gains (losses)	0.2	$ 0.4
Summary of estimated aggregate amortization expense for each of the succeeding five years
2023 (remaining nine months)	31.8
2024	40.1
2025	35.9
2026	26.4
2027	25.8
Thereafter	82.2
Total	242.2
Trade names
Intangible assets not subject to amortization:
Intangible assets not subject to amortization, Gross Carrying Amount	$ 765.8		765.7
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	$ 713.8		713.6
Intangible assets subject to amortization, Accumulated Amortization	$ (490.5)		(479.3)
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		22.3
Intangible assets subject to amortization, Accumulated Amortization	$ (3.8)		(3.1)
Other
Intangible assets subject to amortization:
Weighted average amortizable life in years	9 years 2 months 12 days
Intangible assets subject to amortization, Gross Carrying Amount	$ 9.9		9.9
Intangible assets subject to amortization, Accumulated Amortization	$ (9.5)		$ (9.5)

Debt - Summary (Details)

Debt - Summary (Details) - USD ($) $ in Millions	Mar. 31, 2023	Jan. 15, 2023	Dec. 31, 2022
Debt
Total	$ 1,159.6		$ 1,659.6
Less: unamortized discount and debt issuance costs	(11.2)		(12)
Less: amounts due within one year and short-term borrowings	(8.2)		(508.2)
Total long-term debt	1,140.2		1,139.4
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%, due April 15, 2023, redeemed on January 15, 2023
Debt
Total		$ 0	$ 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%		1.30%
Effective rate (as a percent)	1.53%		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%		2.15%
Effective rate (as a percent)	2.27%		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%		6.85%
Effective rate (as a percent)	6.91%		6.91%
Other notes and revolving credit facilities
Debt
Total	$ 9.6		$ 9.6

Debt - Other (Details)

Debt - Other (Details) $ in Millions			3 Months Ended
Debt - Other (Details) $ in Millions	Jan. 15, 2023 USD ($)	Sep. 03, 2020 USD ($)	Mar. 31, 2023 USD ($) item	Dec. 31, 2022 USD ($)
Debt
Total			$ 1,159.6	$ 1,659.6
Weighted average interest rate (as a percent)			2.89%	3.37%
Principal payment on long-term debt			$ 500
Number of financial maintenance covenants \| item			2
Aggregate maturities of long-term debt for each of the next five years and thereafter
Total			$ 1,159.6	$ 1,659.6
Unsecured revolving credit facility maturing September 3, 2025
Debt
Maximum borrowing capacity		$ 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	7.7
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
Variable interest rate			SOFR
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%, due April 15, 2023, redeemed on January 15, 2023
Debt
Total	$ 0			$ 500
Semi-annual rate (as a percent)	4.50%			4.50%
Principal payment on long-term debt	$ 500
Aggregate maturities of long-term debt for each of the next five years and thereafter
Total	$ 0			$ 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%	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%	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%	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
Debt
Maximum borrowing capacity			7.9
Total			2.2	2.2
Aggregate maturities of long-term debt for each of the next five years and thereafter
Total			2.2	2.2
IRB
Debt
Total			7.4	7.4
Aggregate maturities of long-term debt for each of the next five years and thereafter
Total			7.4	$ 7.4
Letter of Credit \| Standby Facility
Debt
Maximum borrowing capacity			50
Letters of credit outstanding			$ 19.5

Leases (Details)

Leases (Details) - USD ($) $ in Millions	3 Months Ended
Leases (Details) - USD ($) $ in Millions	Mar. 31, 2023	Mar. 31, 2022
Operating lease cost	$ 23.6	$ 23
Cash payments for operating leases	23.5	21.8
Right-of-use assets obtained in exchange for operating lease obligations	$ 15.6	$ 7.1
Weighted average remaining lease term - operating leases	6 years 6 months	6 years 7 months 6 days
Weighted average discount rate - operating leases	3.90%	3.80%
Maturities of operating lease liabilities
2023 (remaining nine months)	$ 46.3
2024	52.7
2025	39.9
2026	27.6
2027	19.6
Thereafter	68.5
Total operating lease payments	254.6
Less: imputed interest	(35.9)
Total operating lease liabilities	218.7
Maximum
Finance right-of-use assets	1
Finance right-of-use obligations	$ 1

Income Taxes (Details)

Income Taxes (Details)	3 Months Ended
Income Taxes (Details)	Mar. 31, 2023	Mar. 31, 2022
Income Taxes
Effective tax rate (as a percent)	24.40%	24.80%
Income tax at U.S. federal statutory tax rate (as a percent)	21%	21%

Equity - Share Repurchases, Div

Equity - Share Repurchases, Dividends, Stock-Based Compensation (Details) - USD ($) $ / shares in Units, $ in Millions		1 Months Ended	3 Months Ended
	Apr. 25, 2023	Feb. 28, 2023	Mar. 31, 2023	Mar. 31, 2022	Jul. 26, 2022
Share Repurchase Plan
Value of shares authorized by the Board of Directors to be repurchased under share repurchase plan					$ 1,000
Share repurchases (in shares)			160,224	113,529
Average costs per share			$ 242.86	$ 150.97
Value of shares repurchased			$ 38.9	$ 17.1
Remaining value of shares authorized by the Board of Directors to be repurchased under share repurchase plan			641.8
Common Stock and Additional Paid-In (in Shares)
Payments made to tax authorities on employees' behalf			$ 37.2	$ 17.1
Dividends
Common stock quarterly dividend per share (in dollars per share)			$ 1	$ 0.875
Common stock dividend quarterly declared and paid per share (in dollars per share)	$ 1		$ 1	$ 0.875
Dividends paid			$ 59	$ 54.2
Additional share-based compensation disclosures
Total unrecognized compensation cost			$ 123.9
Unvested RSUs and PSUs expected to be settled through issuance of common stock (in units)			772,952
Common stock to be issued for settlement of unvested RSUs and PSUs (in shares)			993,124
Weighted average recognition period for unrecognized compensation cost (in years)			2 years
Common Stock and Additional Paid in Capital
Share Repurchase Plan
Value of shares repurchased			$ (23.7)	(5.3)
Restricted stock units (RSUs)
Dividends
Dividend equivalents paid			$ 3	$ 2.5
Additional share-based compensation disclosures
Vesting period (in years)		3 years
Changes
Granted (in shares)		109,683
Restricted stock units (RSUs) and performance stock units (PSUs)
Changes
Unvested at the beginning of the year (in units)			582,012
Granted (in shares)			193,812
Vested (in units)			(870)
Cancelled or forfeited (in units)			(2,002)
Unvested at the end of the period (in units)			772,952
Shares reserved for future grants (all plans)			1,457,448
Weighted Average Grant Date Fair Value
Unvested at the beginning of the year (in dollars per unit)			$ 164.60
Granted (in dollars per unit)			247.90
Vested (in dollars per unit)			152.93
Cancelled or forfeited (in dollars per unit)			170.84
Unvested at the end of the period (in dollars per unit)			$ 185.48
Performance stock units (PSUs)
Additional share-based compensation disclosures
Vesting period (in years)		3 years	3 years
Return on assets result period		3 years	3 years	3 years
Changes
Granted (in shares)		84,129
Performance stock units (PSUs) \| Maximum
Stock Based Compensation
Share of Common Stock		2	2	2
All stock-based compensation plans
Common Stock and Additional Paid-In (in Shares)
Payments made to tax authorities on employees' behalf			$ 37.2	$ 17.1

Equity - Accumulated Other Comp

Equity - Accumulated Other Comprehensive Loss (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2023	Dec. 31, 2022
Schedule of accumulated other comprehensive loss
Balance at the beginning of the period	$ (86.3)
Current-period change	(0.2)
Balance at the end of the period	(86.5)
Deferred tax assets in accumulated other comprehensive loss, pension liabilities	1.3	$ 1.3
Foreign Currency Translation (Loss) Gain
Schedule of accumulated other comprehensive loss
Balance at the beginning of the period	(84)
Current-period change	0.6
Balance at the end of the period	(83.4)
Pension and Postretirement Benefit Plan Adjustments, Net of Tax
Schedule of accumulated other comprehensive loss
Balance at the beginning of the period	(2.3)
Current-period change	(0.8)
Balance at the end of the period	$ (3.1)

Commitments and Contingencies (

Commitments and Contingencies (Details)	Mar. 31, 2023
Environmental Contingencies
Ownership interest in domestic subsidiaries (as a percent)	100%

Earnings Per Share (Details)

Earnings Per Share (Details) - USD ($) $ / shares in Units, $ in Millions	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Numerator:
Net income attributable to Reliance	$ 383.1	$ 523.3
Denominator:
Weighted average shares outstanding (in shares)	58,832,000	61,833,000
Dilutive effect of stock-based awards (in shares)	702,000	951,000
Weighted average diluted shares outstanding (in shares)	59,534,000	62,784,000
Earnings per share attributable to Reliance stockholders - basic (in dollars per share)	$ 6.51	$ 8.46
Earnings per share attributable to Reliance stockholders - diluted (in dollars per share)	$ 6.43	$ 8.33
Diluted shares
Weighted average shares, respectively, for RSUs and PSUs, not included in the diluted calculation due to their anti-dilutive effect	194,304	314,042

Subsequent Event (Details)

Subsequent Event (Details) $ in Millions	May 01, 2023 USD ($)
Subsequent events \| Southern Steel
Subsequent Event
Previous annual net sales	$ 62.9