Reliance Steel sees Q3 adjusted EPS $4.90-$5.10, consensus $5.02

Reliance anticipates underlying demand will remain healthy across the majority of the end markets it serves in the third quarter of 2023. However, the Company expects shipment levels to be impacted by normal seasonal patterns, which include a decline in shipping volumes due to planned customer shutdowns and vacation schedules, along with one less shipping day. As a result, the Company expects tons sold will be down 2% to 4% in the third quarter of 2023 compared to the second quarter of 2023 but up 1.5% to 3.5% from the third quarter of 2022. In addition, Reliance expects its average selling price per ton sold for the third quarter of 2023 to be down 2% to 4% compared to the second quarter of 2023 primarily driven by declining prices for flat-rolled products in carbon steel, stainless steel and common alloy aluminum along with carbon steel tubing products, which collectively represent about 35% of its sales. Further, the Company anticipates temporary downward pressure on its gross profit margin in the third quarter as a result of selling into a declining metal price environment for certain of its products. Based on these expectations, the Company anticipates non-GAAP earnings per diluted share in the range of $4.90 to $5.10 for the third quarter of 2023.