Reliance Steel & Aluminum Co. (NYSE:RS) Q2 2020 Earnings Conference Call - Final Transcript

Jul 23, 2020 • 11:00 am ET

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Reliance Steel & Aluminum Co. (NYSE:RS) Q2 2020 Earnings Conference Call - Final Transcript

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Presentation
Operator
Operator

Greetings, ladies and gentlemen, and welcome to the Reliance Steel & Aluminum Company's Second Quarter 2020 Earnings Conference Call. [Operator Instructions].

It is now my pleasure to introduce your host, Ms. Brenda Miyamoto. Thank you. You may begin.

Executive
Brenda Miyamoto

Thank you, operator. Good morning and thanks to all of you for joining our conference call to discuss our second quarter 2020 financial results. I'm joined by Jim Hoffman, our President and CEO and Karla Lewis, our Senior Executive Vice President and CFO. Bill Sales, our Executive Vice President of Operations, will also be available during the question-and-answer portion of this call.

A recording of this call will be posted on the Investors section of our website at investor.rsac.com. The press release and the information on this call may contain certain forward-looking statements which are based on a number of assumptions that are subject to change and involve known and unknown risks, uncertainties or other factors, including the impacts of the COVID-19 pandemic and related economic conditions on our future operations, which may not be under the company's control, which may cause the actual results, performance or achievement of the company to be materially different from the results, performance, or other expectations implied by these forward-looking statements.

These factors include, but are not limited to, those factors disclosed in the company's Annual Report on Form 10-K for the year ended December 31, 2019 and as updated in the company's quarterly report on Form 10-Q for the quarter ended March 31, 2020 under the caption Risk Factors, disclosure in our press release this morning and other reports filed with the Securities and Exchange Commission. The press release and the information on this call speak only as of today's date and the company disclaims any duty to update the information provided therein and herein.

I will now turn the call over to Jim Hoffman, President and CEO of Reliance.

Executive
James D. Hoffman

Thanks, Brenda. Good morning, everyone and thank you all for joining us today to discuss our second quarter 2020 financial results. The strength and resiliency of our business model produced solid results during an extraordinary and extremely challenging quarter. Because we support many customers deemed essential businesses, our tons sold declined only 17.5% compared to the first quarter of 2020.

We maintained a strong gross profit margin of 30.4% on net sales of $2.02 billion, which combined with reduced operating expenses, resulted in pre-tax income of $102 million and earnings per diluted share of $1.24. We adjusted our working capital in response to reduced activity levels and generated cash flow from operations of $475.7 million.

At the outset, I'd like to sincerely thank each and every one of my Reliance colleagues for their flexibility and hard work in a truly extraordinary environment. We are the best of what we do because of you and your effort in this quarter proves it. Our managers in the field did an exceptional job navigating a highly volatile quarter while remaining focused on employee health and safety, including implementing enhanced