Ryerson Holding Corp
For the period ended Dec 31, 2024. Filed Feb 20, 2025.
View on SEC.govAbout this filing
A company's yearly report to the SEC, with audited financial statements. It is the fullest account a company gives of its business, its finances and the risks it sees.
FY2024 · Filed Feb 20, 2025
RYZ$27.60+3.8%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-K
Period ended 2023-12-31; filed 2024-02-21.
0000950170-24-018005
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-K
Period ended 2024-12-31; filed 2025-02-20.
0000950170-25-024199
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 133 previous paragraphs and 117 current paragraphs.
59 unchanged; 40 reworded; 18 added; 33 removed; 1 previous and 0 current paragraphs rearranged.
Tables are not compared: 13 previous and 12 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (18)
Current report
In 2024, the Company completed investments intended to optimize our service center network through organic growth investments, increased integration of our service center network through a common IT platform, and the strategic acquisition of Production Metals, LLC ("Production Metals").
Current report
During the year, our organic growth investments were highlighted by the ramp-up of operations at our 900,000-square-foot service center located in University Park, IL, for our wholly-owned subsidiary, Central Steel & Wire, LLC ("CSW"), which features expanded bar and tube processing capabilities. Additionally, we invested in the expansion of our Shelbyville, KY service center, which includes a state-of-the-art cut-to-length line and automated storage and retrieval system for sheet products. Along with larger optimization projects, we also invested in strategically allocating value-added equipment throughout our service center network. Our integration initiatives were underscored by the continued improvements in our ERP system after we unified 17 key service centers onto a common platform in 2023. After commencing in 2022, our ERP integrates over 80% of Ryerson, based on sales, onto a unified ERP system, enabling our service center network to collaborate effectively in fulfilling customer orders while identifying opportunities to reduce associated costs. We also launched our redesigned e-commerce platform at www.Ryerson.com.
Current report
Supplementing our internal growth initiatives, Ryerson augmented its service center network by acquiring Production Metals. This acquisition introduced valuable Aerospace & Defense exposure to Ryerson’s end-market mix as well as value-added capabilities. Please refer to the section titled "2024 Acquisition" within this Item as well as Note 2 — “Acquisitions” of Part II, Item 8 Financial Statements and Supplementary Data for further information on our 2024 acquisition.
Current report
Despite the key achievements in 2024, the year was marked by difficult business conditions and falling commodity prices. While our investment cycle occurred against the backdrop of volatile pricing and contracting demand, we believe that our initiatives will translate into an improved operating model that will provide better customer experiences.
Current report
In February 2025, the U.S. government announced a number of tariffs on imports, including imports on steel and aluminum, from all countries including Canada and Mexico. Some countries have threatened retaliatory measures on imports from the U.S. Additionally, tariffs were raised and country specific exemptions and quotas were eliminated under section 232 of the Trade Expansion Act. It is unclear at this time what the final tariff actions will be, or the impact they will have on our operations.
Current report
2024 Acquisition
Current report
On August 1, 2024, JT Ryerson paid $44.1 million to acquire Production Metals. Based out of Monroe, Connecticut, Production Metals serves New England and the surrounding area with bar, tube, sheet, and plate products along with precision sawing, lasering, and water jet cutting in the aerospace, defense, and semiconductor end markets. Production Metals provides JT Ryerson with an opportunity to bolster our value-added aluminum, stainless, and specialty steel offerings in the Northeast United States and throughout the entire JT Ryerson network of service centers.
Current report
In 2024, we recorded restructuring charges of $3.1 million, related to severance costs for headcount reductions as we work on optimizing our operating model and improving productivity. The year 2024 also included a $1.6 million gain on an insurance settlement.
Current report
Our effective income tax rate was 1.4% in 2024 compared to 24.4% in 2023. The decrease in the effective tax rate was primarily driven by the impact of a low pretax loss in 2024, which caused recurring permanent differences to have a disproportionate impact on the overall tax rate. The prior year tax rate of 24.4% was more in line with statutory rates, as the higher pretax income resulted in a more normalized relationship between income tax expense and pretax book earnings.
Current report
Due to the closure of the CSW headquarters in Chicago, IL and move to University Park, IL, a significant reduction in the service years of employees occurred between the fourth quarter of 2023 and first quarter of 2024, triggering curtailment accounting. The CSW Pension and Postretirement Benefits plans were remeasured as of February 29, 2024, resulting in a curtailment gain. As the curtailment was a net gain, the gain is required to be reflected in the periods in which the terminations occur, resulting in a curtailment gain of $0.3 million recognized in the first quarter of 2024 and $0.5 million recognized in the fourth quarter of 2023 for those terminations occurring during the respective periods. Additionally, the CSW Pension Plan made lump sum payments during 2024 that were in excess of service cost and interest cost and therefore, a settlement gain of $1.8 million was recognized in 2024. As a result of the remeasurement, the discount rate for measuring obligations of the CSW pension plan was updated as of February 29, 2024 while the expected long-term rate of return on pension assets remained unchanged from December 31, 2023. See Part II. Item 8, Financial Statements and Supplementary Data, Note 10: Employee Benefits for further details.
Current report
In the first quarter of 2024, the Ryerson Canada Bargaining Unit Pension Plan made $1.2 million of lump sum payments to plan participants and purchased $5.0 million of annuities on behalf of plan participants. The lump sum payments and annuity purchases consisted of all of the existing liabilities of the Ryerson Canada Bargaining Unit Pension Plan, resulting in the termination of the plan. The Ryerson Canada Bargaining Unit Pension Plan was fully funded as of the termination date, and as such, all lump sum payments and annuity purchases were funded with pension plan assets. As a result of the termination, the Company recorded a $2.1 million settlement loss in 2024.
Current report
The net settlement loss and the curtailment gain were recorded within Other income and (expense), net in the Consolidated Statements of Operations as of December 31, 2024.
Current report
Based on the impairment test performed on October 1, 2024, the Company concluded that the fair value of the reporting units tested for impairment exceeded the carrying value. As of the date of our quantitative assessment, $159.8 million of goodwill resides at the U.S. reporting unit, which represents the majority of the Company's goodwill balance. Based upon the quantitative assessment performed for the U.S. reporting unit, the fair value of the U.S. reporting unit exceeded its carrying value by 13% and as such it was determined that no impairment existed.
Current report
The determination of the fair value of the reporting units requires the Company to make significant estimates including forecasts of business and financial performance of the Company’s reporting units. These estimates and assumptions primarily include but are not limited to: the selection of appropriate peer group companies, control premiums appropriate for acquisitions in the industries in which we compete, discount rates, terminal growth rates, and forecasts of revenue, gross margin, operating income, depreciation, amortization, and capital expenditures.
Current report
In evaluating the U.S. reporting unit, significant weight is placed on forecasted earnings before interest, taxes, depreciation and amortization ("EBITDA") and the weighted average cost of capital (“WACC”) used in the discounted cash flow model, as we determined these items have the most significant impact on the fair value of the reporting unit.
Current report
EBITDA is expected to improve provided that pricing and volumes stabilize, and we expect to gain operating leverage through the growth initiatives that have been undertaken by the Company, such as significant investment in capital expenditures targeted towards our transactional business, specifically higher margin-value added business and our investment in acquisitions resulting in new product lines, industry exposures, and expanded capabilities to our overall portfolio.
Current report
We used a WACC of 16.5% based upon market participants assumptions. We performed a sensitivity analysis on our estimated fair value noting that a 100 basis point increase in the discount rate results in a decrease of approximately 5% of the excess fair value over the carrying value of the reporting unit.
Current report
Although the Company believes its estimates of fair value are reasonable, actual financial results could differ from those estimates due to inherent uncertainty in making such estimates. A lack of recovery or further deterioration in market conditions, a trend of weaker than expected financial performance in our business, or a lack of recovery or further decline in the Company’s market capitalization, among other factors, could result in an impairment charge in future periods which could have a material adverse effect on our financial statements.
Removed paragraphs (33)
Previous report
During the year, the Company invested in optimizing its service center network through organic growth investments as well as strategic acquisitions. In 2023, Ryerson’s newly constructed 214,000 square foot service center facility in Centralia, Washington became fully operational, which serves the Pacific Northwest market and features advanced processing capabilities for sheet, plate, and long products. Over the year, Ryerson also progressed with construction on a 900,000 square foot service center facility for its wholly-owned subsidiary, Central Steel & Wire Company, located in University Park, IL, which will feature expanded bar and tube processing capabilities and is expected to be operational by the second quarter of 2024.
Previous report
In addition, Ryerson augmented its service center network through the acquisition of four companies, BLP Holdings, LLC ("BLP"), Norlen Incorporated ("Norlen"), TSA Processing ("TSA"), and Hudson Tool Steel Corporation ("Hudson"). These acquisitions bolster value-added processing capabilities in custom engineering and robotic manufacturing, broaden supply chain networks and service points, and diversify Ryerson’s transactional customer portfolio to secular end markets, which include HVAC, Agriculture, Oil & Gas, and Aerospace-related applications. Please refer to the section titled "Acquisitions" within this Item as well as Note 2 — “Acquisitions” of Part II, Item 8 "Financial Statements and Supplementary Data" for further consolidated information on our 2023 acquisitions.
Previous report
During 2023, the Company repurchased $113.9 million of its common stock including the repurchase of 2.9 million shares from its largest shareholder, Platinum Equity. Overall, Platinum Equity's sale of shares increased the share free float to 88.5% of shares outstanding, up from 57% as of December 31, 2022. As of May 1, 2023, $20 million of $75 million remained under the existing share repurchase authorization and the Board of Directors authorized increasing and extending the Company's share repurchase program by $80.0 million to $100.0 million expiring in April 2025. Throughout the year, Ryerson’s Board of Directors increased the quarterly cash dividend consecutively across all four quarters, and returned $24.8 million to shareholders in the form of dividends. In 2023, through share repurchases and dividends, Ryerson returned approximately $139 million to shareholders.
Previous report
In December of 2023, Ryerson published its second Sustainability Report, which describes the Company’s commitment to making meaningful progress in five key focus areas: diversity, equity and inclusion, energy and emissions, talent and future workforce, circular economy, and data security. Additionally, the report highlights Ryerson’s scope 1 and 2 emissions, relative emissions comparisons to metals and distribution peers, commitment to employee safety and continued outperformance of industry average OSHA rates, as well as initiatives by the Company’s talent management office to develop its workforce.
Previous report
In 2023, the Company progressed in its financial strategy. In adherence with a core pillar of our financial priorities announced at our investor day in 2022, we maintained our leverage ratio within the target range between 0.5x to 2.0x throughout the year. In recognition of the Company’s substantial reduction in debt in 2022, achieved by retiring the remaining $300 million of the 2028 Notes, Ryerson received a credit upgrade from Fitch in February of 2023. Two of its covering agencies also gave the Company an upgrade in 2022. Moody’s upgraded Ryerson’s corporate rating to Ba3 from B1, Standard & Poor’s (“S&P”) upgraded it to BB- from B+, and Fitch issued an upgrade to BB from BB-. The following table summarizes the Company’s current ratings by agency.
Previous report
On February 24, 2023, the US government announced trade actions targeting goods and entities from Russia, which included a proclamation to impose 200% ad valorem tariffs on Russian-origin aluminum products and derivative products and other articles made from Russian primary aluminum or Russian aluminum castings. The duties will be imposed under section 232 of the Trade Expansion Act ("Section 232") and cited by the White House due to (1) challenges faced by US aluminum producers in the face of high levels of aluminum imports and high energy prices; (2) recent increases in imports of aluminum from Russia, whose market is especially export-oriented, by 53 percent between March and July 2022; and (3) the fact that the Russian aluminum industry is a key part of Russia's defense industrial base. Ryerson has communicated to all vendors that we will not accept any Russian originating metal. The trade actions announced by the US government should support prices for Ryerson's product sales mix prices as the underlying domestic and North American supply-demand balance is protected from oversupply.
Previous report
After the Russian forces invaded Ukraine on February 24, 2022, the Biden administration issued executive orders prohibiting
Previous report
the importation of goods from covered regions related to Ukraine and Russia. Ryerson takes this very seriously and has reviewed our
Previous report
direct and indirect material purchases to ensure compliance. On April 8, 2022, President Biden signed into law the Suspending Normal
Previous report
Trade Relations with Russia and Belarus Act, which denies "most-favored nation" tariff treatment to products of Russia and Belarus
Previous report
and extends the President’s authority to impose sanctions under the Global Magnitsky Human Rights Accountability Act. Beginning
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April 9, 2022, the Act imposes a 10.5% import duty on unalloyed primary aluminum and 11.0% on value-add aluminum products. The
Previous report
import duties are not expected to have a meaningful impact on the availability of aluminum for Ryerson. In 2023, the Company has
Previous report
not purchased material from Russia or the named Ukrainian regions and has no open purchases orders issued to Russian suppliers as
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of December 31, 2023.
Previous report
Acquisitions
Previous report
On March 1, 2023, JT Ryerson acquired BLP. Based out of Houston, Texas, BLP is comprised of three divisions: Absolute Metal Products, Metal Cutting Specialists, and Houston Water Jet, serving various industries such as oil & gas, aerospace, telecommunications, and structural fabrication. BLP provides complex fabrication services in addition to toll processing, including saw cutting, machining, and water jet cutting. The total amount paid by JT Ryerson for the acquisition amounted to $39.9 million.
Previous report
On October 2, 2023, JT Ryerson acquired Norlen. Based out of Schofield, Wisconsin, Norlen is a full-service metal fabricator, providing stamping, machining, painting, and additional value-added fabrication services to industries including agriculture, HVAC, and defense. The total amount paid by JT Ryerson, net of cash acquired, for the acquisition amounted to $30.5 million.
Previous report
On November 1, 2023, JT Ryerson acquired TSA. Headquartered in Houston, Texas, with five other locations across the Midwest and Southern United States, TSA is a stainless steel and aluminum coil and sheet processor. The total amount paid by JT Ryerson, net of cash acquired, for the acquisition amounted to $37.7 million.
Previous report
On December 1, 2023, JT Ryerson acquired Hudson. Hudson is headquartered in Cerritos, California, with two facilities located in the Midwest and Northeast. Hudson is a supplier of tool steels and high-speed, carbon, and alloy steels. The total amount paid by JT Ryerson, net of cash acquired, for the acquisition amounted to $19.4 million.
Previous report
Additionally, during the first six months of 2023, JT Ryerson completed the purchase of certain assets from ExOne Operating, LLC. The total amount paid by JT Ryerson for the acquired assets was $9.7 million.
Previous report
The 2023 acquisitions strengthen and expand JT Ryerson's valued-add services within our industry-leading stainless and aluminum franchises as well as our tool steel capabilities which will allow us to increase our offerings to better serve our diverse customer base across our entire network. The 2023 acquisitions are not individually significant to the consolidated financial statements. Please refer to Note 2 — “Acquisitions” of Part II, Item 8 "Financial Statements and Supplementary Data" for further consolidated information on our 2023 acquisitions.
Previous report
higher employee benefit costs of $8.3 million in 2023, primarily due to higher medical costs and stock compensation;
Previous report
higher salaries and wage expense of $4.9 million in 2023 primarily due to compensation increases;
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higher operating expenses of $4.3 million in 2023 primarily due to higher repair & maintenance costs, higher information technology expenses, and higher insurance expense; and
Previous report
higher selling, general, and administrative expenses of $1.3 million in 2023 resulting from higher travel and entertainment expenses;
Previous report
partially offset by lower incentive compensation expense of $21.2 million.
Previous report
In 2022, we recorded a gain on sale of assets of $3.8 million from the sale of a facility in Texas that Ryerson had an option to purchase.
Previous report
The $47.3 million income tax provision in 2023 and the $131.4 million tax provision in 2022 primarily represent taxes at federal and local statutory rates where the Company operates, but generally exclude any tax benefit for losses in jurisdictions with historical losses.
Previous report
Noncontrolling Interest
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In both 2023 and 2022, Ryerson China’s results of operations was income and the portion attributable to the noncontrolling interest was $0.7 million and $0.5 million, respectively.
Previous report
Provision for allowances, claims, and doubtful accounts: We perform ongoing credit evaluations of customers and set credit limits based upon review of the customers’ current credit information, payment history, and the current economic and industry environments. We monitor customer payments and maintain a provision for estimated credit losses based on historical experience and specific customer collection issues that we have identified. Estimation of such losses requires adjusting historical loss experience for current economic conditions and judgments about the probable effects of economic conditions on certain customers. We cannot guarantee that the rate of future credit losses will be similar to past experience. Provisions for allowances and claims are based upon historical rates, expected trends, and estimates of potential returns, allowances, customer discounts, and incentives. We consider all available information when assessing the adequacy of the provision for allowances, claims, and doubtful accounts.
Previous report
Based on the impairment test performed on October 1, 2023, the Company concluded that the fair value of the reporting units tested for impairment exceeded the carrying value. The discount rate was estimated to be 13.5% at October 1, 2023. The Company determines a discount rate based on an estimate of a reasonable risk-adjusted return an investor would expect to realize on an investment in the reporting unit. Deterioration in market conditions in our industry or products, changes in expected future cash flows, expected growth rates, or to discount rates could result in impairment charges in future periods.
Reworded paragraphs (40)
Previous wording
Ryerson Holding Corporation (“Ryerson Holding”), a Delaware corporation, is the parent company of Joseph T. Ryerson & Son, Inc. (“JT Ryerson”), a Delaware corporation. Affiliates of Platinum Equity, LLC (“Platinum”) own approximately 3,924,478 shares of our common stock, which is approximately 11.5% of our issued and outstanding common stock.
Current wording
Ryerson Holding Corporation (“Ryerson Holding”), a Delaware corporation, is the parent company of Joseph T. Ryerson & Son, Inc. (“JT Ryerson”), a Delaware corporation. Affiliates of Platinum Equity, LLC (“Platinum”) own approximately 3,924,478 shares of our common stock, which is approximately 12.3% of our issued and outstanding common stock.
Previous wording
We are a metals service center providing value-added processing and distribution of industrial metals with operations in the U.S., Canada, Mexico, and China. We purchase large quantities of metal products from primary producers and sell these materials in smaller quantities to a wide variety of metals-consuming industries. We carry a full line of approximately 75,000 products in stainless steel, aluminum, carbon steel, and alloy steels and a limited line of nickel and red metals in various shapes and forms. In addition to our metals products, we offer numerous value-added processing and fabrication services, and nearly 80% of the metals products we sell are processed by us by bending, beveling, blanking, blasting, burning, cutting-to-length, drilling, embossing, flattening, forming, grinding, laser cutting, machining, notching, painting, perforating, polishing, punching, rolling, sawing, scribing, shearing, slitting, stamping, tapping, threading, welding, or other techniques to process materials to a specified thickness, length, width, shape, and surface quality pursuant to specific customer orders.
Current wording
We are a metals service center providing value-added processing and distribution of industrial metals with operations in the U.S., Canada, Mexico, and China. We purchase large quantities of metal products from primary producers and sell these materials in smaller quantities to a wide variety of metals-consuming industries. We carry a full line of approximately 75,000 products in stainless steel, aluminum, carbon steel, and alloy steels and a limited line of nickel and red metals in various shapes and forms. In addition to our metals products, we offer numerous value-added processing and fabrication services, and nearly 80% of the metals products we sell are processed by us by bending, beveling, blanking, blasting, burning, cutting-to-length, drilling, flattening, forming, grinding, laser cutting, machining, notching, painting, polishing, punching, rolling, sawing, shearing, slitting, stamping, tapping, threading, welding, or other techniques to process materials to a specified thickness, length, width, shape, and surface quality pursuant to specific customer orders.
Previous wording
The metals service center industry is cyclical and volatile in both demand and pricing, and difficult to predict. In 2023, Ryerson experienced a decline in average selling prices of 15.7% and a decline in shipments of 4.2% when compared to 2022 as the period was characterized by normalizing global supply and declining demand during 2023, with higher inflation and high interest rates contributing to slower economic conditions for industrial manufacturing. Changes in average selling prices are primarily driven by commodity metals prices, which impact Ryerson’s selling prices over the subsequent three to six-month period.
Current wording
The metals service center industry is cyclical and volatile in both demand and pricing, and difficult to predict. In 2024, Ryerson experienced a decline in average selling prices of 9.7% and a decline in shipments of 0.3% when compared to 2023 as the period was characterized by global oversupply and declining demand during 2024, with higher inflation and high interest rates contributing to slower economic conditions for industrial manufacturing. Changes in average selling prices are primarily driven by commodity metals prices, which impact Ryerson’s selling prices over the subsequent three to six-month period.
Previous wording
Throughout 2023, indicators in the key steel industry end markets reported contraction in industrial activity. This is evidenced by the Institute for Supply Management’s Purchasing Managers’ Index (“PMI”), which reported contracting activity during the year with readings below the growth threshold of 50%, indicating a slowdown in factory activity. Similarly, U.S. Industrial Production, which reports year-over-year industrial sector business output, reported low or slowing growth in output for most of the year.
Current wording
Throughout 2024, indicators in the key steel industry end markets reported contraction in industrial activity. This is evidenced by the Institute for Supply Management’s Purchasing Managers’ Index (“PMI”), which reported contracting activity in every month of 2024 with readings below the growth threshold of 50, indicating a slowdown in factory activity. Similarly, U.S. Industrial Production, which reports year-over-year industrial sector business output, reported low or slowing growth in output for most of the year.
Previous wording
According to the Metal Service Center Institute, North American service center volumes increased by 1.5% in 2023 compared to 2022. On a North American basis, Ryerson's North American volumes declined 4.8% over the same period. While most sectors experienced declines in volumes, Ryerson experienced demand growth in commercial ground transportation and oil & gas on a year-over-year basis.
Current wording
According to the Metal Service Center Institute, North American service center volumes decreased by 3.0% in 2024 compared to 2023. On a North American basis, Ryerson's North American volumes declined 1.0% over the same period. While Ryerson experienced year-over-year volume declines in Consumer Durables, Oil & Gas, Commercial Ground Transportation, and Industrial Machinery & Equipment, these declines were partially offset by demand growth in HVAC, Food Processing & Agriculture Equipment, Construction Equipment, and Metal Fabrication and Machine Shops.
Previous wording
Ryerson’s market strategy focuses on providing excellent customer experiences consistently with speed at scale. Our culture is based on our trademarked “say yes, figure it out” mantra as we strive to grow volume and sustainably expand margins by increasing our fabrication business, transactional sales and improving our speed through our use of both tools and analytics. Ryerson’s financial strategy includes a focus on generating cash from operating activities and continuously improving a “through the cycle” operating model in order to maintain a strong balance sheet, re-invest in the growth of the business, and generate returns to shareholders.
Current wording
Ryerson’s market strategy focuses on providing excellent customer experiences consistently with speed at scale. Our culture is based on our trademarked “say yes, figure it out” mantra. We strive to grow our volume and sustainably expand margins by increasing our fabrication business, transactional sales, and improving our speed through tools and analytics. Ryerson’s financial strategy includes a focus on generating cash from operating activities and continuously improving a “through the cycle” operating model to maintain a strong balance sheet, re-invest in the growth of the business, and generate returns to shareholders.
Previous wording
A reconciliation of diluted EPS to adjusted diluted EPS is provided below.
Current wording
A reconciliation of diluted earnings (loss) per share ("EPS") to adjusted diluted EPS is provided below.
Previous wording
Lower commodity prices and slower economic conditions in metals markets in 2023 caused lower average selling prices and lower volumes. Compared to 2022, average selling prices decreased by 15.7% and tons shipped decreased by 4.2%, resulting in a year-over-year revenue decrease of 19.2%. Gross margin contracted by 70 bps from 2022 as decreasing market prices, and therefore selling prices, outpaced the decrease in inventory costs. Warehousing, delivery, selling, general, and administrative expenses for 2023 increased by $58.3 million compared to 2022 driven primarily by inclusion of operating expenses from companies acquired in 2022 and 2023 and increased reorganization costs, primarily due to increased system conversion activity as well as start up costs associated with our new state of the art University Park location. We generated net income attributable to Ryerson Holding Corporation of $145.7 million, or $4.10 per diluted share, in 2023. This compares to net income attributable to Ryerson Holding Corporation of $391.0 million, or earnings of $10.21 per diluted share, for 2022. The year over year decreases are a result of the decline in commodity prices and slower economic conditions,
Current wording
Lower commodity prices and slower economic conditions in metals markets in 2024 caused lower average selling prices and lower volumes. Compared to 2023, average selling prices decreased by 9.7% and tons shipped decreased by 0.3%, resulting in a year-over-year revenue decrease of 10.0%. Gross margin contracted by 190 bps from 2023 as decreasing market prices, and therefore selling prices, outpaced the decrease in inventory costs. Warehousing, delivery, selling, general, and administrative expenses for 2024 increased by $7.7 million compared to 2023 driven primarily by the inclusion of operating expenses from companies acquired in 2023 and 2024 and increased reorganization costs, primarily due to increased system conversion activity as well as start up costs associated with our new state of the art University Park location. Partially offsetting the expense increases were lower employee related costs in 2024 resulting from workforce reductions as well as lower variable incentive compensation. We recorded net loss attributable to Ryerson Holding Corporation of $8.6 million, or $0.26 per diluted share, in 2024. This compares to net income attributable to Ryerson Holding Corporation of $145.7 million, or earnings of $4.10 per diluted share, for 2023. The year over year decreases are a result of the decline in commodity prices and the effects of contracting industrial manufacturing demand.
Previous wording
To provide greater insight into the Company’s 2023 operating trends apart from the year’s one-time transactions, Ryerson provides adjusted net income and adjusted diluted earnings per share figures, which are not U.S. generally accepted accounting principles (“GAAP”) financial measures, to compliment the reported GAAP net income and diluted earnings per share figures. Management uses these metrics to assess year-over-year performance excluding non-recurring transactions. Adjusted net income and adjusted diluted earnings per share do not represent, and should not be used as a substitute for, net income or earnings per share determined in accordance with GAAP. Illustrated in the below table, the 2023 net income attributable to Ryerson Holding Corporation of $145.7 million includes a $0.8 million curtailment gain related to various retirement benefit plans. After adjusting for this non-core business transaction and the related income taxes, the adjusted net income attributable to Ryerson Holding Corporation for 2023 is $145.1 million, a decrease of $258.5 million compared to the prior year’s adjusted net income attributable to Ryerson Holding Corporation of $403.6 million which included $21.3 million of expenses related to the redemption of $300.0 million of the 8.50% senior secured notes due 2028 (the “2028 Notes”), a $3.8 million gain on the sale of assets, and a $0.6 million bargain purchase gain related to the acquisition of Ford Tool Steels, Inc., and related income taxes.
Current wording
To provide greater insight into the Company’s 2024 operating trends apart from the year’s one-time transactions, Ryerson provides adjusted net income (loss) and adjusted diluted earnings (loss) per share figures, which are not U.S. generally accepted accounting principles (“GAAP”) financial measures, to compliment the reported GAAP net income (loss) and diluted earnings (loss) per share figures. Management uses these metrics to assess year-over-year performance excluding non-recurring transactions. Adjusted net income (loss) and adjusted diluted earnings (loss) per share do not represent, and should not be used as a substitute for, net income (loss) or earnings (loss) per share determined in accordance with GAAP. Illustrated in the below table, the 2024 net loss attributable to Ryerson Holding Corporation of $8.6 million includes a restructuring charge of $3.1 million, as well as a pension settlement loss of $2.1 million, a $1.6 million gain on an insurance settlement, and a $0.3 million curtailment gain related to various retirement benefit plans, and the related income tax benefit. After adjusting for these non-core business transactions and the related income taxes, the adjusted net loss attributable to Ryerson Holding Corporation for 2024 is $6.1 million, a decrease of $151.2 million compared to the prior year’s adjusted net income attributable to Ryerson Holding Corporation of $145.1 million which included a $0.8 million curtailment gain related to various retirement benefit plans and related income taxes.
Previous wording
Ryerson generated cash from operating activities of $365.1 million in 2023, a decrease compared to $501.2 million generated in 2022. The decrease in cash generation year over year is primarily due to lower net income generation. See further details within the the section titled "Liquidity and Capital Resources" within this Item.
Current wording
Ryerson generated cash from operating activities of $204.9 million in 2024, a decrease compared to $365.1 million generated in 2023. The decrease in cash generation year over year is primarily due to lower net income generation. See further details within the section titled "Liquidity and Capital Resources" within this Item.
Previous wording
The following charts show the Company’s percentage of sales by major product lines for 2023 and 2022:
Current wording
The following charts show the Company’s percentage of sales by major product line for 2024 and 2023:
Previous wording
Revenue for the year ended December 31, 2023, decreased from the same period a year ago due to lower average selling prices caused by lower commodity prices and to lower volume caused by slower economic conditions in metal markets in 2023. Commodity prices were at cyclical highs in 2021 and 2022 before beginning to decline in the second half of 2022. Compared to the year ago period, average selling price decreased for all of our product lines in 2023 with the largest decreases in our carbon flat, stainless flat, and carbon plate products. Tons sold decreased in 2023 overall, with the largest decreases in our stainless flat, aluminum long, and carbon long product lines partially offset by an increase in our stainless, aluminum, and carbon plate shipments. Tons sold per ship day were 7,741 in 2023 compared to 8,084 in 2022.
Current wording
Revenue for the year ended December 31, 2024, decreased from the same period a year ago due to lower average selling prices caused by lower commodity prices in 2024 due to the effects of contracting industrial manufacturing demand. Compared to the year ago period, average selling price decreased for all of our product lines in 2024 with the largest decreases in our stainless flat, stainless long, carbon plate, and stainless plate products. Tons sold decreased slightly in 2024 overall, with the largest decreases in our carbon long, aluminum long, and aluminum plate product lines largely offset by an increase in our carbon flat shipments. Tons sold per ship day were 7,656 in 2024 compared to 7,741 in 2023.
Previous wording
The decrease in cost of materials sold in 2023 compared to the year ago period is primarily due to a decrease in average cost of materials sold per ton and to lower tons sold. The average cost of materials sold decreased across all of our product lines with the average cost of materials sold for our carbon product lines decreasing more than our other product lines during 2023.
Current wording
The decrease in cost of materials sold in 2024 compared to the year ago period is primarily due to a decrease in average cost of materials sold per ton caused by lower commodity prices. The average cost of materials sold decreased across all of our product lines with the average cost of materials sold for our stainless product lines decreasing more than our other product lines during 2024.
Previous wording
During 2023, LIFO income was $98 million related to decreases in pricing for all product lines, with the largest impact from carbon products, slightly offset by the liquidation of older LIFO layers for stainless and aluminum products that were at a net higher cost. During 2022, LIFO income was $58 million related to a decrease in pricing for carbon product lines, partially offset by increases in pricing in stainless and aluminum products as well as the impact of a reduction in carbon tons in inventory, which led to the liquidation of older LIFO layers that were at a higher cost.
Current wording
During 2024, LIFO income was $53 million related to decreases in pricing for all product lines, with the largest impact from the carbon and stainless products, slightly offset by the liquidation of older LIFO layers for stainless products that were at a net higher cost. During 2023, LIFO income was $98 million related to decreases in pricing for all product lines, with the largest impact from carbon products, slightly offset by the liquidation of older LIFO layers for stainless products that were at a net higher cost.
Previous wording
Warehousing, delivery, selling, general, and administrative expenses increased $58.3 million in 2023 compared to 2022 with $28.4 million of the increase driven by including the expenses of companies acquired during 2022 and 2023. Excluding the impact of acquisitions, expenses changed in the following categories:
Current wording
Warehousing, delivery, selling, general, and administrative expenses increased $7.7 million in 2024 compared to 2023 with $27.8 million of the increase driven by including the expenses of companies acquired during 2023 and 2024 for the full year periods. Excluding the impact of acquisitions, expenses decreased $20.1 million. On a same-store basis, expenses decreased in 2024 primarily due to lower incentive compensation expense resulting from lower profitability and lower employee benefit expense mainly due to a reduction in employee headcount. Partially offsetting the expense decreases was an increase in reorganization costs in 2024 primarily due to start up costs associated with our new state of the art University Park location as well as system optimization activity.
Previous wording
On a per ton basis, total operating expenses increased to $408 per ton in 2023 from $360 per ton in 2022.
Current wording
On a per ton basis, total operating expenses increased to $414 per ton in 2024 from $408 per ton in 2023.
Previous wording
Interest and other expense on debt increased in 2023 compared to 2022 primarily due to higher interest rates on credit facility borrowings under our $1.3 billion revolving credit facility (“the Ryerson Credit Facility”) and a higher level of borrowings outstanding under the Ryerson Credit Facility compared to the prior year. Partially offsetting this increase was the redemption and repurchase of $300.0 million principal amount of our 8.50% senior secured notes due 2028 (the “2028 Notes”) during 2022, bringing the outstanding principal balance to zero in July 2022. Interest expense in 2022 included $2.6 million in charges to write-off unamortized bond issuance costs related to the $300.0 million of 2028 Notes redeemed in 2022.
Current wording
Interest and other expense on debt increased in 2024 compared to 2023 primarily due to a higher level of borrowings outstanding under our $1.3 billion revolving credit facility (“the Ryerson Credit Facility”).
Previous wording
The other income and (expense), net in 2023 includes a $0.8 million gain on the curtailment of certain Central Steel & Wire ("CSW") pension and other post-employment benefit plans. The curtailment is due to a reduction in future years of service resulting from workforce reductions at CSW as the CSW headquarters is closing and operations are moving to a new facility in University Park, IL. The other income and (expense), net in 2022 includes foreign currency translation losses of $1.3 million. In addition, the year 2022 includes losses of $21.3 million on the redemption and repurchase of $300.0 million of the 2028 Notes.
Current wording
The other income and (expense), net in 2024 includes foreign currency translation gains of $4.2 million. The other income in 2024 also includes a $2.1 million net settlement resulting from the termination of the Ryerson Canada Bargaining Unit Pension Plan. Offsetting this loss is a $1.8 million settlement gain and a $0.3 million curtailment gain related to lump-sum buyouts and a reduction in future years of service for the CSW pension and other post-employment benefit plans as a result of workforce reductions at CSW as the CSW headquarters is closing and operations are moving to a new facility in University Park, IL. The other income and (expense), net in 2023 includes a $0.8 million gain on the curtailment of certain CSW pension and other post-employment benefit plans related to the plant move discussed above.
Previous wording
Basic and diluted earnings per share was $4.17 and $4.10, respectively, in 2023. Basic and diluted earnings per share was $10.41 and $10.21, respectively, in 2022. The changes in earnings per share are due to the results of operations discussed above as well as having fewer shares outstanding in 2023 after the repurchase in 2023 of 3,253,313 shares of common stock, including 2,882,720 shares from Platinum, in addition to the repurchase of 1,700,766 shares of common stock during 2022.
Current wording
The changes in earnings (loss) per share are due to the results of operations discussed above as well as having fewer shares outstanding in 2024 after the repurchase of 2,526,467 shares of common stock during 2024.
Previous wording
The Company’s primary sources of liquidity are cash and cash equivalents, cash flows from operations, and borrowing availability under the Ryerson Credit Facility. Our principal source of operating cash is from the sale of metals and other materials. Our principal uses of cash are for payments associated with the procurement and processing of metals and other materials inventories, costs incurred for the warehousing and delivery of inventories, the selling and administrative costs of the business, capital expenditures, and for interest payments on debt.
Current wording
The Company’s primary sources of liquidity are cash and cash equivalents, cash flows from operations, and borrowing availability under the Ryerson Credit Facility. Our principal source of operating cash is from the sale of metals. Our principal uses of cash are for payments associated with the procurement and processing of metals, costs incurred for the warehousing and delivery of inventories, the selling and administrative costs of the business, capital expenditures, and for interest payments on debt.
Previous wording
We had cash and cash equivalents of $54.3 million at December 31,2023, compared to $39.2 million at December 31, 2022. Our total debt outstanding at December 31, 2023 increased to $436.5 million compared to $367.0 million of total debt outstanding at December 31, 2022 due to acquisitions, capital expenditures, share repurchases and dividends paid, partially offset by income from operations in 2023. We had a debt-to-capitalization ratio of 32% and 29% at December 31, 2023 and at December 31, 2022, respectively. We had total liquidity (defined as cash and cash equivalents, and availability under the Ryerson Credit Facility and foreign debt facilities) of $656 million at December 31, 2023 versus $909 million at December 31, 2022. Our net debt (defined as total debt less cash and cash equivalents) was $382 million and $328 million at December 31, 2023 and December 31, 2022, respectively. Total liquidity and net debt are not U.S. generally accepted accounting principles (“GAAP”) financial measures. We believe that total liquidity provides additional information for measuring our ability to fund our operations. Total liquidity does not represent, and should not be used as a substitute for, net income or cash flows from operations as determined in accordance with GAAP and total liquidity is not necessarily an indication of whether cash flow will be sufficient to fund our cash requirements. We believe that net debt provides a clearer perspective of the Company’s overall debt situation. Net debt should not be used as a substitute for total debt outstanding as determined in accordance with GAAP.
Current wording
We had cash and cash equivalents of $27.7 million at December 31, 2024, compared to $54.3 million at December 31, 2023. Our total debt outstanding at December 31, 2024 increased to $467.4 million compared to $436.5 million of total debt outstanding at December 31, 2023. We had a debt-to-capitalization ratio of 36% and 32% at December 31, 2024 and at December 31, 2023, respectively. We had total liquidity (defined as cash and cash equivalents, and availability under the Ryerson Credit Facility and foreign debt facilities) of $451 million at December 31, 2024 versus $656 million at December 31, 2023. Our net debt (defined as total debt less cash and cash equivalents) was $440 million and $382 million at December 31, 2024 and December 31, 2023, respectively. Total liquidity and net debt are not U.S. generally accepted accounting principles (“GAAP”) financial measures. We believe that total liquidity provides additional information for measuring our ability to fund our operations. Total liquidity does not represent, and should not be used as a substitute for, net income or cash flows from operations as determined in accordance with GAAP and total liquidity is not necessarily an indication of whether cash flow will be sufficient to fund our cash requirements. We believe that net debt provides a clearer perspective of the Company’s overall debt situation. Net debt should not be used as a substitute for total debt outstanding as determined in accordance with GAAP.
Previous wording
Of the total cash and cash equivalents, as of December 31, 2023, $34.2 million was held in subsidiaries outside the U.S. that is deemed to be permanently reinvested. Ryerson does not currently foresee a need to repatriate earnings from its non-U.S. subsidiaries. Although Ryerson has historically satisfied needs for more capital in the U.S. through debt or equity issuances and a significant portion of the earnings held in foreign jurisdictions is deemed to have been repatriated under the 2017 U.S. Tax Cuts and Jobs Act, Ryerson could elect to repatriate additional earnings, which could result in foreign withholding taxes and potential U.S. state income taxes. We have not recorded a deferred tax liability for the effect of a possible repatriation of these earnings as management intends to permanently reinvest these earnings outside of the U.S. Specific plans for reinvestment include funding for future international acquisitions and funding of existing international operations.
Current wording
Of the total cash and cash equivalents, as of December 31, 2024, $13.4 million was held in subsidiaries outside the U.S. that is deemed to be permanently reinvested. Ryerson does not currently foresee a need to repatriate earnings from its non-U.S. subsidiaries. Although Ryerson has historically satisfied needs for more capital in the U.S. through debt or equity issuances, Ryerson could elect to repatriate additional earnings, which could result in foreign withholding taxes and potential U.S. state income taxes. We have not recorded a deferred tax liability for the effect of a possible repatriation of these earnings as management intends to permanently reinvest these earnings outside of the U.S. Specific plans for reinvestment include funding for future international acquisitions and funding of existing international operations.
Previous wording
Operating activities. In 2023, average selling prices were 15.7% lower than in 2022 resulting in lower cash generated from operations. Working capital fluctuates throughout the year based on business needs. Working capital needs tend to be counter-cyclical, meaning that in periods of expansion the Company will use cash to fund working capital requirements, but in periods of contraction the Company will generate cash from reduced working capital requirements. Working capital requirements decreased in 2023 primarily due to a decline in average selling prices and lower shipments in the fourth quarter of 2023 compared to the fourth quarter of 2022, which resulted in lower sales and the related accounts receivable. Additionally, inventory costs decreased as market prices for metals decreased in 2023, resulting in a lower inventory investment. Material purchases were higher at the end of the fourth quarter of 2023 compared to the end of the fourth quarter of 2022 resulting in an increase in accounts payable in the fourth quarter of 2023. In 2022, average selling prices were 15.1% higher than in 2021 resulting in significantly higher operating profits and higher cash generated from operations. Working capital requirements in 2022 decreased due to lower shipments and a decline in average selling prices in the fourth quarter of 2022, which resulted in lower sales and the related accounts receivable. Inventory quantities on hand decreased to align with softer demand conditions. The lower inventory investment also decreased accounts payable balances. In 2022, we made estimated tax payments based on our forecasted income. Sales slowed in the fourth quarter of 2022, creating a tax overpayment, which was applied toward 2023 taxes due causing less cash payments for taxes in 2023.
Current wording
Operating activities. In 2024, average selling prices were 9.7% lower than in 2023 resulting in lower cash generated from operations. Working capital fluctuates throughout the year based on business needs. Working capital needs tend to be counter-cyclical, meaning that in periods of expansion the Company will use cash to fund working capital requirements, but in periods of contraction the Company will generate cash from reduced working capital requirements. Working capital requirements decreased in 2024 primarily due to a decrease in inventory, as market prices for metals decreased in 2024, along with lower tons in inventory to better align inventory levels with lower sales volumes. A decline in average selling prices and lower shipments in the fourth quarter of 2024 compared to the fourth quarter of 2023, resulted in lower sales and the related decrease in accounts receivable. The decrease in accounts payable was driven by lower metals costs and reduced inventory purchases in the fourth of 2024 compared to fourth quarter of 2023. Working capital requirements decreased in 2023 primarily due to a decline in average selling prices and lower shipments in the fourth quarter of 2023 compared to the fourth quarter of 2022, which resulted in lower sales and the related accounts receivable. Additionally, inventory costs decreased as market prices for metals decreased in 2023, resulting in a lower inventory investment. Material purchases were higher at the end of the fourth quarter of 2023 compared to the fourth quarter of 2022 resulting in an increase in accounts payable in the fourth quarter of 2023.
Previous wording
Investing activities. The Company's main investing activities are acquisitions, capital expenditures, and proceeds from the sale of property, plant, and equipment. Capital expenditures increased year-over-year to $121.9 million in 2023 compared to $105.1 million in 2022, as the Company continued its investment in a new facility in University Park, Illinois, a project which began in 2022 and expanded and modernized its Shelbyville, Kentucky location in 2023. In 2023, the Company paid $127.5 million to acquire BLP, TSA, Norlen, and Hudson, and paid $9.7 million to purchase certain assets from ExOne Operating, LLC. See Note 2: Acquisitions within Part II, Item 8 of this report, for further discussion of the acquisitions. The Company paid $57.0 million in 2022 to acquire Apogee Steel Fabrication Incorporated, Ford Tool Steels, Inc., Howard Precision Metals, Inc., and Excelsior, Inc. The Company sold property, plant, and equipment and assets held for sale generating cash proceeds of $0.5 and $8.0 million in 2023 and 2022, respectively.
Current wording
Investing activities. The Company's main investing activities are capital expenditures and acquisitions. Capital expenditures decreased year-over-year as the Company is nearing completion of its investment in a new facility in University Park, Illinois, a project which began in 2022. In 2024, the Company paid $44.1 million to acquire Production Metals. In 2023, the Company paid $127.5 million to acquire BLP Holdings, LLC, TSA Processing, Norlen Incorporated, and Hudson Tool Steel Corporation, and paid $9.7 million to purchase certain assets from ExOne Operating, LLC. See Note 2: Acquisitions within Part II, Item 8 of this report, for further discussion of the acquisitions.
Previous wording
Financing activities. The Company's main source of liquidity to fund working capital requirements is borrowings on our credit facility. In 2023, acquisitions and capital expenditures, as well as share repurchases and dividends paid, were in excess of cash from operations, which increased borrowings on the Ryerson Credit Facility. In 2022, we repurchased, redeemed, and retired $300.0 million principal of our 2028 Notes, which was partially offset by an increase of $49.0 million in Credit Facility borrowings. Book overdrafts fluctuate based on the timing of payments. Cash dividends paid in 2023 were $24.8 million compared to $19.9 million paid to shareholders in 2022. We repurchased $113.9 million of common stock during the 2023 compared to $50.0 of common stock repurchased in 2022.
Current wording
Financing activities. The Company's main source of liquidity to fund working capital requirements is borrowings on our credit facility. In both 2024 and 2023, we increased credit facility borrowings to fund our acquisitions and capital expenditures. Book overdrafts fluctuate based on the timing of payments. Cash dividends of $24.8 million were paid to shareholders in both 2024 and 2023. We repurchased $51.0 million of common stock during 2024 compared to $113.9 of common stock repurchased in 2023.
Previous wording
In the normal course of business with customers, vendors, and others, we have entered into off-balance sheet arrangements, such as letters of credit, which totaled $10.9 million as of December 31, 2023. We do not have any other material off-balance sheet financing arrangements. Our off-balance sheet arrangements are not likely to have a material effect on our current or future financial condition, results of operations, liquidity, or capital resources.
Current wording
In the normal course of business with customers, vendors, and others, we have entered into off-balance sheet arrangements, such as letters of credit and surety bonds, which totaled $2 million and $12 million, respectively as of December 31, 2024. We do not have any other material off-balance sheet financing arrangements. Our off-balance sheet arrangements are not likely to have a material effect on our current or future financial condition, results of operations, liquidity, or capital resources.
Previous wording
Total debt at December 31, 2023 increased $69.5 million to $436.5 million from $367.0 million at December 31, 2022, mainly due to funding new acquisitions in 2023.
Current wording
Total debt at December 31, 2024 increased $30.9 million to $467.4 million from $436.5 million at December 31, 2023, mainly due to funding the acquisition of Production Metals in 2024.
Previous wording
Total debt outstanding as of December 31, 2023 consisted of the following amounts: $433.0 million borrowings under the Ryerson Credit Facility, $6.0 million of foreign debt, and $2.2 million of other debt, less $4.7 million of unamortized debt issuance costs. Availability under the Ryerson Credit Facility was $560 million and $826 million at December 31, 2023 and December 31, 2022, respectively. For further information, see Note 9: Debt in Part II, Item 8 – Financial Statements and Supplementary Data.
Current wording
Total debt outstanding as of December 31, 2024 consisted of the following amounts: $470.0 million borrowings under the Ryerson Credit Facility, $0.7 million of foreign debt, less $3.3 million of unamortized debt issuance costs. Availability under the Ryerson Credit Facility was $376 million and $560 million at December 31, 2024 and December 31, 2023, respectively. For further information, see Note 9: Debt in Part II, Item 8 – Financial Statements and Supplementary Data.
Previous wording
The Company made contributions of $8.8 million in 2023, $6.8 million in 2022, and $23.7 million in 2021 to improve the Company’s pension plans funded status. At December 31, 2023, as reflected in Part II. Item 8, Financial Statements and Supplementary Data, Note 10, pension liabilities exceeded plan assets by $63.9 million. The Company anticipates that it will have a minimum required pension contribution of approximately $11.0 million in 2024 under the Employee Retirement Income Security Act of 1974 (“ERISA”), Pension Protection Act in the U.S., and the Ontario Pension Benefits Act in Canada. The expected future contributions reflect pension funding relief measures under the American Rescue Plan Act (“ARPA”) passed in March 2021. Future contribution requirements depend on the investment returns on plan assets, the impact of discount rates on pension liabilities, and changes in regulatory requirements. The Company is unable to determine the amount or timing of any such contributions required by ERISA or whether any such contributions would have a material adverse effect on the Company’s financial position or cash flows.
Current wording
The Company made contributions of $10.9 million in 2024, $8.8 million in 2023, and $6.8 million in 2022 to improve the Company’s pension plans funded status. At December 31, 2024, as reflected in Part II. Item 8, Financial Statements and Supplementary Data, Note 10, pension liabilities exceeded plan assets by $52.9 million. The Company anticipates that it will have a minimum required pension contribution of approximately $15.2 million in 2025 under the Employee Retirement Income Security Act of 1974 (“ERISA”), Pension Protection Act in the U.S., and the Ontario Pension Benefits Act in Canada. The expected future contributions reflect pension funding relief measures under the American Rescue Plan Act (“ARPA”) passed in March 2021. Future contribution requirements depend on the investment returns on plan assets, the impact of discount rates on pension liabilities, and changes in regulatory requirements. The Company is unable to determine the amount or timing of any such contributions required by ERISA or whether any such contributions would have a material adverse effect on the Company’s financial position or cash flows.
Previous wording
The Company made income tax payments of $6.2 million in 2023, $176.9 million in 2022, and $70.2 million in 2021. Income tax payments in 2023 decreased due to lower pre-tax income year over year in addition to prior year tax over payments being applied toward 2023 taxes due. See Part II. Item 8, Financial Statements and Supplementary Data, Note 18: Income Taxes for further discussion.
Current wording
The Company made income tax payments of $10.3 million in 2024, $6.2 million in 2023, and $176.9 million in 2022. Income tax payments in 2024 increased over the prior year partly due to payments made in the current year to cover taxes incurred in the prior period. Otherwise, payments reflect lower pre-tax income year over year. See Part II. Item 8, Financial Statements and Supplementary Data, Note 18: Income Taxes for further discussion.
Previous wording
The Company expects to make approximately $441 million in principal payments to satisfy its debt obligations, consisting of $6 million in foreign debt coming due in 2024, $2 million of other debt coming due in 2024, and $433 million for the Ryerson Credit Facility coming due in 2027. Please refer to Part II. Item 8, Financial Statements and Supplementary Data, Note 9: Debt for further information.
Current wording
The Company expects to make approximately $471 million in principal payments to satisfy its debt obligations, consisting of $1 million in foreign debt coming due in 2025, and $470 million for the Ryerson Credit Facility coming due in 2027. Please refer to Part II. Item 8, Financial Statements and Supplementary Data, Note 9: Debt for further information.
Previous wording
The Company expects to pay approximately $29 million of interest on the Ryerson Credit Facility, foreign debt, and other debt over the next 12 months and $72 million thereafter. Interest payments related to the variable rate debt were estimated using the weighted average interest rate for the respective debt instrument.
Current wording
The Company expects to pay approximately $28 million of interest on the Ryerson Credit Facility and foreign debt over the next 12 months and $42 million thereafter. Interest payments related to the variable rate debt were estimated using the weighted average interest rate for the respective debt instrument.
Previous wording
The Company leases various assets including real estate, trucks, trailers, cars, mobile equipment, processing equipment, and IT equipment. We have noncancelable operating leases expiring at various times through 2043, and finance leases expiring at various times through 2030. The total amount of future lease payments is estimated to be $485 million with $48 million for the next 12 months. Please refer to Part II, Item 8 – Financial Statements and Supplementary Data, Note 6: Leases for further information.
Current wording
The Company leases various assets including real estate, trucks, trailers, cars, mobile equipment, processing equipment, and IT equipment. We have noncancelable operating leases expiring at various times through 2043, and finance leases expiring at various times through 2031. The total amount of future lease payments is estimated to be $477 million with $49 million for the next 12 months. Please refer to Part II, Item 8 – Financial Statements and Supplementary Data, Note 6: Leases for further information.
Previous wording
Purchase obligations with suppliers are entered into when we receive firm sales commitments with certain of our customers. As of December 31, 2023, we had outstanding purchase obligations of approximately $20 million expiring in 2024.
Current wording
Purchase obligations with suppliers are entered into when we receive firm sales commitments with certain of our customers. As of December 31, 2024, we had outstanding purchase obligations of approximately $15 million expiring in 2025.
Previous wording
At December 31, 2023, the Company had a net deferred tax liability of $136 million comprised primarily of a deferred tax asset of $17 million related to pension liabilities, a deferred tax asset related to postretirement benefits other than pensions of $9 million, deferred tax assets of $7 million related to state, local, and foreign tax loss carryforwards, $93 million related to operating lease liabilities, and $22 million of other deferred taxes relating to accrued compensation and other items, offset by a valuation allowance of $4 million and deferred tax liabilities of $86 million related to fixed assets, $99 million related to inventory, $88 million related to operating lease assets, and $7 million related to intangibles. We may experience fluctuations in our forecasted earnings before income taxes as a result of events which cannot be predicted, which could affect our deferred tax balances.
Current wording
At December 31, 2024, the Company had a net deferred tax liability of $129 million comprised primarily of a deferred tax asset of $13 million related to pension liabilities, a deferred tax asset related to postretirement benefits other than pensions of $8 million, deferred tax assets of $11 million related to state, local, and foreign tax loss carryforwards, $93 million related to operating lease liabilities, $19 million of other deferred taxes relating to accrued compensation and other items, $11 million of interest limitation carryforward, and $7 million of federal net operating loss carryforward, offset by a valuation allowance of $4 million and deferred tax liabilities of $91 million related to fixed assets, $101 million related to inventory, $87 million related to operating lease assets, and $8 million related to intangibles. We may experience fluctuations in our forecasted earnings before income taxes as a result of events which cannot be predicted, which could affect our deferred tax balances.
Previous wording
In accordance with ASC Topic 740, “Income Taxes,” the Company assesses the realizability of its deferred tax assets. The Company records a valuation allowance when, based upon the evaluation of all available evidence, it is more-likely-than-not that all or a portion of the deferred tax assets will not be realized. In making this determination, we analyze, among other things, our recent history of earnings, the nature and timing of reversing book-tax temporary differences, tax planning strategies, and future income. As of December 31, 2021, the Company had a valuation allowance of $5.0 million, a decrease of $1.6 million from the prior year mainly related to a release of a valuation allowance on state NOL deferred tax assets, which we now expect to realize due to improved profitability. The valuation allowance did not change during 2022, remaining at $5.0 million as of December 31, 2022 related to U.S. federal tax credit deferred tax assets and foreign tax assets. As of December 31, 2023, the Company had a valuation allowance of $4.0 million, a decrease of $1.0 million from the prior year mainly related to an adjustment to certain U.S. federal tax credits and deferred tax assets which were fully reserved. As of December 31, 2023, the valuation allowance continues to be related to U.S. federal tax credit deferred tax assets and foreign tax assets.
Current wording
In accordance with ASC Topic 740, “Income Taxes,” the Company assesses the realizability of its deferred tax assets. The Company records a valuation allowance when, based upon the evaluation of all available evidence, it is more-likely-than-not that all or a portion of the deferred tax assets will not be realized. In making this determination, we analyze, among other things, our recent history of earnings, the nature and timing of reversing book-tax temporary differences, tax planning strategies, and future income. As of December 31, 2024, the Company had a valuation allowance of $4 million. As of December 31, 2023, the Company had a valuation allowance of $4 million, a decrease of $1 million from the prior year mainly related to an adjustment to certain U.S. federal tax credits and deferred tax assets which were fully reserved. As of December 31, 2024, the valuation allowance continues to be related to U.S. federal tax credit deferred tax assets and foreign tax assets.
Previous wording
Purchase Price Accounting: Business combinations are accounted for using the acquisition method of accounting. This method requires the Company to record assets and liabilities of the business acquired at their estimated fair market values as of the acquisition date. Any excess of the cost of the acquisition over the fair value of the net assets acquired is recorded as goodwill. Any shortfall in the cost of the acquisition compared to the fair value of the net assets acquired is recorded in the Consolidated Statements of Operations as a bargain purchase gain. The Company uses valuation specialists, where necessary, to perform appraisals and assist in the determination of the fair values of the assets acquired and liabilities assumed. These valuations require management to make estimates and assumptions that are critical in determining the fair values of the assets and liabilities.
Current wording
Purchase Price Accounting: Business combinations are accounted for using the acquisition method of accounting. This method requires the Company to record assets and liabilities of the business acquired at their estimated fair market values as of the acquisition date. Any excess of the cost of the acquisition over the fair value of the net assets acquired is recorded as goodwill. Any shortfall in the cost of the acquisition compared to the fair value of the net assets acquired is recorded in the Consolidated Statement of Operations as a bargain purchase gain. The Company uses valuation specialists, where necessary, to perform appraisals and assist in the determination of the fair values of the assets acquired and liabilities assumed. These valuations require management to make estimates and assumptions that are critical in determining the fair values of the assets and liabilities.
Previous wording
When calculating pension expense for 2023, we assumed the pension plans’ assets would generate a long-term rate of return of 6.05% for the JT Ryerson plan and 3.80% for the Central Steel and Wire Company plan, and between 4.25% and 6.00% for the Canadian plans. The expected long-term rate of return assumption was developed based on historical experience and input from the trustee managing the plans’ assets. The expected long-term rate of return on plan assets is based on a target allocation of assets, which is based on a goal of earning the highest rate of return while maintaining risk at acceptable levels. The plans strive to have assets sufficiently diversified so that adverse or unexpected results from one security class will not have an unduly detrimental impact on the entire portfolio. We regularly review actual asset allocation and the pension plans’ investments are periodically rebalanced to the targeted allocation when considered appropriate. Pension expense increases as the expected rate of return on plan assets decreases. Lowering the expected long-term rate of return on plan assets by 50 basis points would have increased 2023 pension expense by approximately $1 million.
Current wording
When calculating pension expense for 2024, we assumed the pension plans’ assets would generate a long-term rate of return of 5.95% for the JT Ryerson plan and 3.85% for the Central Steel and Wire Company plan, and between 4.00% and 5.25% for the Canadian plans. The expected long-term rate of return assumption was developed based on historical experience and input from the trustee managing the plans’ assets. The expected long-term rate of return on plan assets is based on a target allocation of assets, which is based on a goal of earning the highest rate of return while maintaining risk at acceptable levels. The plans strive to have assets sufficiently diversified so that adverse or unexpected results from one security class will not have an unduly detrimental impact on the entire portfolio. We regularly review actual asset allocation and the pension plans’ investments are periodically rebalanced to the targeted allocation when considered appropriate. Pension expense increases as the expected rate of return on plan assets decreases. Lowering the expected long-term rate of return on plan assets by 50 basis points would have increased 2024 pension expense by approximately $1 million.
Previous wording
Future pension obligations for the U.S. plans were discounted using rates between of 5.05% and 5.24% at December 31, 2023. Future pension obligations for the Canadian plans were discounted using 4.64% at December 31, 2023. Lowering the discount rate by 50 basis points would increase the pension liability at December 31, 2023 by approximately $15 million.
Current wording
Future pension obligations for the U.S. plans were discounted using rates between of 5.67% and 5.98% at December 31, 2024. Future pension obligations for the Canadian plans were discounted using rate between 4.55% and 4.89% at December 31, 2024. Lowering the discount rate by 50 basis points would increase the pension liability at December 31, 2024 by approximately $13 million.
Previous wording
The calculation of other postretirement benefit obligations requires the use of a number of assumptions, including the assumed discount rate between 4.63% and 5.06% at December 31, 2023 for measuring future payment obligations. A decrease in the weighted average discount rate of 50 basis points would increase the postretirement benefit liability by approximately $2 million.
Current wording
The calculation of other postretirement benefit obligations requires the use of a number of assumptions, including the assumed discount rate between 4.40% and 5.69% at December 31, 2024 for measuring future payment obligations. A decrease in the weighted average discount rate of 50 basis points would increase the postretirement benefit liability by approximately $1 million.
Rearranged previous paragraphs (1)
Previous report — wording carried elsewhere
higher reorganization costs of $28.7 million in 2023 primarily due to increased system conversion activity as well as start up costs associated with our new state of the art University Park location;