Ryerson Holding Corp: Form 10-Q for the period ended Jun 30, 2026

Unless the context indicates otherwise, Ryerson Holding Corporation ("Ryerson Holding") and its subsidiary companies are collectively referred to as “Ryerson,” “we,” “us,” “our,” or the “Company.”

This Quarterly Report contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements can be identified by the use of forward-looking terminology such as “objectives,” “goals,” “preliminary,” “range,” “believes,” “expects,” “may,” “estimates,” “will,” “should,” “plans,” or “anticipates” or the negative thereof or other variations thereon or comparable terminology, or by discussions of strategy. Readers are cautioned that any such forward-looking statements are not guarantees of future performance and may involve significant risks and uncertainties, and that actual results may vary materially from those anticipated or implied in the forward-looking statements as a result of various factors. These forward-looking statements involve a number of risks and uncertainties that could cause actual results to differ materially from those suggested by the forward-looking statements. Forward-looking statements should, therefore, be considered in light of various factors, including those set forth under “Special Note Regarding Forward-Looking Statements” and “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2025 filed on February 23, 2026 and the section entitled “Management’s Discussion and Analysis of Financial Condition and Results of Operations – Industry and Operating Trends” and elsewhere in this Quarterly Report on Form 10-Q. Moreover, we caution you not to place undue reliance on these forward-looking statements, which speak only as of the date they were made. We do not undertake any obligation to publicly release any revisions to these forward-looking statements to reflect events or circumstances after the date of this Quarterly Report or to reflect the occurrence of unanticipated events.

The contents herein are provided for general information purposes only and do not constitute an offer to sell or purchase, or a solicitation of an offer to purchase, any security (“Security”) of Ryerson Holding or its affiliates in any jurisdiction. Ryerson does not intend to solicit and is not soliciting, any action with respect to any Security or any other contractual relationship with Ryerson. Nothing in this Form 10-Q, individually or taken in the aggregate, constitutes an offer of securities for sale or purchase, or a solicitation of an offer to purchase, any Security in the United States, or to US persons, or in any other jurisdiction in which such an offer or solicitation is unlawful.

The following Management’s Discussion and Analysis of Financial Condition and Results of Operations ("MD&A") is intended to help the reader understand our results of operations and financial condition as viewed by management. The MD&A should be read in conjunction with our Condensed Consolidated Financial Statements and related Notes thereto in Item 1, “Financial Statements” in this Quarterly Report on Form 10-Q and our Consolidated Financial Statements and related Notes thereto for the year ended December 31, 2025, in our Annual Report on Form 10-K filed on February 23, 2026.

Olympic Steel Acquisition

On February 13, 2026 (the “Closing Date”),the Company completed the transactions contemplated by the Agreement and Plan of Merger, (the “Merger Agreement”), dated as of October 28, 2025, by and among Ryerson Holding, Crimson MS Corp., an Ohio corporation and a direct wholly owned subsidiary of Ryerson Holding (“Merger Sub”), and Olympic Steel, Inc. ("Olympic Steel"). On the Closing Date, pursuant to the Merger Agreement, Merger Sub merged with and into Olympic Steel in accordance with Ohio law (the “Olympic Steel Merger”). At the effective time of the Olympic Steel Merger, each issued and outstanding share of common stock of Olympic Steel, without par per share (the “Olympic Common Stock”) (other than certain excluded shares), was converted into the right to receive 1.7105 shares of Ryerson Holding’s common stock, rounded down to the nearest whole share, and cash in lieu of fractional shares. Upon the completion of the Olympic Steel Merger, Olympic Steel, as the surviving corporation, became a wholly owned subsidiary of Ryerson Holding. As a result of the Olympic Steel Merger, Ryerson Holding issued approximately 19.5 million shares of its common stock to former holders of Olympic Common Stock.

Olympic Steel is a metals service center focused on the direct sale and value-added processing of carbon and coated sheet, plate, and coil products; stainless steel sheet, plate, bar, and coil; aluminum sheet, plate, and coil; pipe, tube, bar, valves and fittings, tin plate, and metal-intensive end-use products. The combination of the two companies enhances Ryerson's presence as one of North America's largest metals service centers, bringing Olympic Steel's complementary footprint, capabilities, and product offering into Ryerson's intelligently interconnected network of value-added service centers. Together, functioning as Ryerson Holding Corporation, the combined entity is expected to generate approximately $120 million in annual synergies by the beginning of 2028 through procurement scale, efficiency gains, commercial enhancement, and network optimization. Please refer to Note 6: Acquisitions in Part I, Item I - Notes to Condensed Consolidated Financial Statements, for further information on the Olympic Steel Merger.

Ryerson Holding is the acquirer of Olympic Steel under U.S. generally accepted accounting principles (“GAAP”), and as a result, our Condensed Consolidated Financial Statements for periods prior to the Closing Date do not include the results of operations, financial position, or cash flows of Olympic Steel. The results of operations of Olympic Steel are included in our Condensed Consolidated Financial Statements only from the Closing Date forward. Accordingly, our results of operations, financial condition, and cash flows after the Closing Date are not comparable to prior periods due to the inclusion of Olympic Steels’s results from the Closing Date. Throughout this document, where relevant, we identify the impact of Olympic Steel and separately provide "same store" information, which excludes Olympic Steel, to provide investors with additional insight into the operating performance of the legacy Ryerson business. Readers should consider both reported results and same-store results when evaluating period-over-period trends.

Olympic Steel contributed significantly to our reported results during the periods presented following the Closing Date. For further information, including purchase accounting impacts, please refer to Note 6: Acquisitions and Note 10: Segment Information in Part I, Item I - Notes to Condensed Consolidated Financial Statements.

Industry and Operating Trends

We are a metals service center providing value-added processing and distribution of industrial metals with operations in the United States, 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 in 2025 nearly 80% of the metals products we sold were 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. We also offer metal-intensive end-use products.

Similar to other metals service centers, we maintain substantial inventories of metals to accommodate the short lead times and just-in-time delivery requirements of our customers. Accordingly, we purchase metals to maintain our inventory at levels that we believe to be appropriate to satisfy the anticipated needs of our customers based upon customer forecasts, historic buying practices, supply agreements with customers, mill lead times, and market conditions. Our commitments to purchase metals are generally at prevailing market prices in effect at the time we place our orders. At the request of our customers, we may enter into swaps in order to mitigate our customers’ risk of volatility in the price of metals, as well as metal hedges to mitigate our own risk of volatility in the price of metals. We have no long-term, fixed-price metals purchase contracts. When metals prices decline, customer demands for lower prices and our competitors’ responses to those demands could result in lower sale prices and, consequently, lower gross profits and earnings as we sell existing metals inventory. When metals prices increase, competitive conditions will influence how much of the price increase we may pass on to our customers. 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.

The metals service center industry is cyclical, volatile in demand and pricing, and difficult to predict. In the second quarter of 2026, Ryerson’s average selling prices increased by 4.5% while shipments increased by 22.6%, or 4.0% excluding Olympic Steel ("same-store"), compared to the first quarter of 2026. Average selling price increases were supported by U.S. industrial metals prices reaching multi-year highs during the quarter as carbon pricing was driven by tight domestic supply, extended lead times, cyclical momentum, and restocking activity. Aluminum prices and Midwest Premiums also rose meaningfully during the quarter, largely due to supply disruptions in the Middle East, while nickel prices remained volatile in response to Indonesian quotas.

Increases in second quarter year-over-year North American same-store shipments were supported by relative strength in nearly all of our end-markets, led by strongest growth in our fabrication and welding sector, followed by growth in our machinery and equipment, machine shop, climate, and heavy equipment sectors. The only end-market that offset this year-over-year growth was our commercial transportation sector, however, we did experience improved shipment volume from commercial transportation on a sequential quarter-over quarter-basis.

Improved demand conditions in the first six months of 2026 were supported by data points from the Institute for Supply Management’s Purchasing Managers’ Index (“PMI”), a key steel industry economic indicator. Monthly readings during the second quarter continued to be over the growth threshold of 50, establishing a six-month streak of expansionary activity. This growth trend contrasts the contractionary trend of the previous three years, during which readings were below 50 for nearly each of those 36 months.

According to the Metal Service Center Institute ("MSCI"), North American service center volumes increased by 2.9% in the first half of 2026 compared to the first half of 2025, supported by improved manufacturing demand. Ryerson's North American same-store volumes, by comparison, increased by 5.8% in the same periods, implying market share gains with particular relative strength in carbon products.

First Six Months 2026 vs. First Six Months 2025 Performance, Total Company

*A reconciliation of the non-GAAP financial measure to the comparable GAAP measure is included in the subsequent table.

To provide greater insight into the Company’s operating trends apart from the period’s one-time transactions, Ryerson provides adjusted net income (loss) and adjusted diluted earnings (loss) per share figures, which are not GAAP financial measures, to complement 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 diluted earnings (loss) per share determined in accordance with GAAP. As illustrated in the below table, net income attributable to Ryerson Holding Corporation of $20.0 million in the first six months of 2026 includes $15.7 million of purchase accounting inventory adjustments, $6.8 million of advisory service fees related to the merger with Olympic Steel, impairment charges on assets of $0.9 million, and a gain of $0.6 million on an insurance settlement. In the first six months of 2025, the net loss attributable to Ryerson Holding Corporation of $3.7 million includes a $1.0 million gain on an insurance settlement and impairment charges on assets of $1.8 million. After adjusting for these non-core business transactions and the related income taxes in the first six months of 2026, the adjusted net income attributable to Ryerson Holding Corporation for the first six months of 2026 is $40.7 million compared to the $3.1 million adjusted net loss attributable to Ryerson Holding Corporation in the first six months of 2025.

(Dollars and shares in millions, except per share data)

Recent Developments

Tariffs. During 2025 and 2026, the U.S. government increased and expanded tariffs imposed under Section 232 of the Trade Expansion Act of 1962, as amended (“Section 232”), on steel, aluminum, and certain derivative and downstream products. The current framework applies different tariff rates based on factors including product classification, country of origin, metal content, and applicable trade arrangements, and in certain cases applies tariffs to the full value of an imported product rather than only its metal content. The government has also continued to modify product coverage, preferential treatment, and documentation requirements.

Foreign governments, including Canada, China, and members of the European Union, have imposed, withdrawn, or modified retaliatory tariffs and other trade measures. The United States, Canada, and Mexico are also reviewing trade rules under the United States-Mexico-Canada Agreement, including matters relating to steel and aluminum, rules of origin, and non-North American content. These actions may further affect cross-border sourcing and supply chains.

On February 20, 2026, the U.S. Supreme Court held that the International Emergency Economic Powers Act did not authorize the tariffs imposed under that statute. The ruling did not affect tariffs imposed under Section 232. The U.S. government has continued to pursue tariffs and other trade restrictions under Section 232 and other statutory authorities, contributing to continued uncertainty regarding the scope and duration of U.S. trade policy.

The tariffs introduce uncertainty towards customers' supply chains and may adversely affect end-market demand as customers may defer orders, reduce inventory levels, or adjust sourcing strategies in response. A significant majority of the Company’s metal purchases are domestic, therefore, the impact of tariffs on the Company’s financial statements has not been significant to date. In general, we attempt to pass the cost of tariffs on to customers to the extent possible. However, we may not be able to fully pass through tariff-related cost increases in all market conditions. While tariffs have helped to level the price between import and domestic purchases, customers are still reviewing their supply chains to determine which approach is best. The ultimate consumer of the goods and their geography play a significant role in determining which inputs are acceptable to manufacturers. The ultimate impact the tariffs will have on our financial position, results of operations, and cash flows remains to be determined.

Iran Conflict. In addition, the ongoing conflict involving Iran and related attacks on commercial shipping in and around the Strait of Hormuz have disrupted maritime transportation and increased uncertainty regarding global supply chains. The duration of the conflict and the extent of its longer-term effects on the availability, cost, and timing of materials remain uncertain. To mitigate these risks, the Company has reduced its exposure to suppliers and shipping routes in the affected region where practicable and is evaluating alternative sources of supply.

Components of Results of Operations

We generate substantially all of our revenue from sales of our metals products. The majority of revenue is recognized upon delivery of product to customers. The timing of shipment is substantially the same as the timing of delivery to customers given the proximity of our distribution sites to our customers. Revenues associated with products that we believe have no alternative use, and where we have an enforceable right to payment, are recognized on an over-time basis. Over-time revenues are recorded in proportion with the progress made toward completing the performance obligation.

Sales, cost of materials sold, gross profit, and operating expense control are the principal factors that impact our profitability.

Net sales. Our sales volume and pricing are driven by market demand, which is largely determined by overall industrial production and conditions in the specific industries in which our customers operate. Sales prices are also primarily driven by market factors such as overall demand and availability of product. Our net sales include revenue from product sales, net of returns, allowances, customer discounts, and incentives.

Cost of materials sold. Cost of materials sold includes metal purchase and in-bound freight costs, third-party processing costs, and direct and indirect internal processing costs. The cost of materials sold fluctuates with our sales volume and our ability to purchase metals at competitive prices. Increases in sales volume generally enable us to improve purchasing leverage with suppliers as we buy larger quantities of metals inventories.

Gross profit. Gross profit is the difference between net sales and the cost of materials sold. Our sales prices to our customers are subject to market competition. Achieving acceptable levels of gross profit is dependent on our acquiring metals at competitive prices, our ability to manage the impact of changing prices, and efficiently managing our internal and external processing costs.

Operating expenses. Optimizing business processes and asset utilization to lower fixed expenses such as employee, facility, and truck fleet costs, which cannot be rapidly reduced in times of declining volume, and maintaining a low fixed cost structure in times of increasing sales volume, have a significant impact on our profitability. Operating expenses include costs related to warehousing and distributing our products as well as selling, general, and administrative expenses.

Results of Operations

The following table sets forth our condensed consolidated statements of income (loss) data for the three-month and six-month periods ended June 30, 2026 and 2025 (certain percentages may not calculate due to rounding):

($ in millions)

($ in millions)

26

Net sales

The following charts show the Company’s percentage of sales by major product lines for the six months ended June 30, 2026 and 2025:

($ in millions)

27

Revenue for the three-month and six-month periods ended June 30, 2026 increased from the same periods a year ago due to higher tons sold as a result of the merger with Olympic Steel on February 13, 2026 as well as higher average selling prices reflecting higher metal commodity prices and improvement in demand conditions in the metals industry. Of the $1,267.7 million increase in net sales over the six month period, $836.9 million was attributable to the inclusion of Olympic Steel results from the February 13, 2026 closing date through June 30, 2026. The remaining $430.8 million increase was attributable to same-store net sales growth. The same-store net sales increase was primarily attributable to approximately $262 million from higher average selling prices, including changes in product mix, and approximately $169 million from higher same-store tons sold, with amounts calculated using average selling price per ton and tons sold and subject to rounding. New products and services resulting from the Olympic Steel Merger did not have a material impact on the year-over-year change in net sales. On a same-store basis, average selling prices increased for all of our product lines in the three-month and six-month periods ended June 30, 2026 with the largest increases in our aluminum plate, aluminum flat, and aluminum long product lines. On a same-store basis, tons sold increased in the three-month and six-month periods ended June 30, 2026, compared to the year-ago periods for most product lines with the largest increases in our stainless plate, carbon long, stainless long, and carbon plate product lines.

Cost of materials sold

($ in millions)

The increase in cost of materials sold in the three-month and six-month periods ended June 30, 2026 compared to the year-ago periods is primarily due to the merger with Olympic Steel as well as an increase in average cost of materials sold per ton. In the three-month and six-month periods ended June 30, 2026 Olympic Steel contributed $468.1 million and $685.3 million to the change, respectively. On a same-store basis, the average cost of materials sold increased across all of our product lines in the three-month and six-month periods ended June 30, 2026 with the largest increases in our aluminum plate, aluminum flat, and aluminum long product lines. During the second quarter of 2026, LIFO expense was $17.0 million compared to $13.2 million in the second quarter of 2025. During the first six months of 2026, LIFO expense was $27.0 million compared to $20.0 million in the first six months of 2025.

Gross profit

($ in millions)

Gross profit increased in the three-month and six-month periods ended June 30, 2026 compared to the year-ago periods primarily due to the merger with Olympic Steel as well as average selling prices increasing faster than the increase in average cost of materials sold. Of the $230.2 million increase in gross profit in the six month period, $151.6 million was attributable to the inclusion of Olympic Steel results from the February 13, 2026 closing date through June 30, 2026, and $78.6 million was attributable to same-store operations. The same-store increase was primarily attributable to the increase in same-store average selling prices and tons sold as discussed above, partially offset by higher average material costs and the increase in LIFO expense.

Operating expenses

($ in millions)

Warehousing, delivery, selling, general, and administrative expenses increased in the three-month and six-month periods ended June 30, 2026 compared to the same periods of the prior year primarily due to the merger with Olympic Steel on February 13, 2026, which increased operating expenses by $101.6 million and $149.2 million, respectively. On a same-store-basis, expenses increased $16.9 million and $32.4 million in the three-month and six-month periods ended June 30, 2026, respectively, as the same-store results included higher advisory services fees of $0.4 million in the second quarter of 2026 and $6.6 million in the first six months of 2026 related to the merger with Olympic Steel, including legal, consulting and investment advisor fees. In addition, the three-month and six-month periods ended June 30, 2026 included higher incentive compensation, increased benefit expenses, primarily due to higher payroll taxes in 2026 as payroll taxes were lower in the first six months of 2025 due to refunds received in the second quarter related to Employee Retention Credits for qualified wages paid during the COVID-19 pandemic, as well as higher delivery and operating expenses.

The three-month and six-month periods ended June 30, 2026 include an impairment charge of $0.5 million and $0.9 million, respectively, related to the impairment of buildings and equipment. The first six months of 2025 included impairment charges on assets of $1.8 million as we evaluated underperforming businesses.

Operating profit

($ in millions)

Our operating profit increased in the three-month and six-month periods ended June 30, 2026 compared to the three-month and six-month periods ended June 30, 2025, primarily due to the increase in gross profit discussed above.

Other expenses

($ in millions)

Interest and other expense on debt increased in the three-month and six-month periods ended June 30, 2026 compared to the year-ago periods primarily due to a higher level of borrowings outstanding under the revolving credit facility (“the Ryerson Credit Facility”) as Olympic Steel's existing debt was paid off upon the merger close, partially offset by lower interest rates.

The other income in the first six months of 2026 includes foreign currency translation gains of $3.9 million. The other income in the first six months of 2025 includes foreign currency translation losses of $2.7 million, partially offset by a $0.5 million settlement gain related to lump-sum buyouts for the Central Steel & Wire ("CSW") pension plan.

Provision (benefit) for income taxes. Our effective income tax rate was 40.3% in the first six months of 2026 compared to 75.8% in the first six months of 2025. The difference between our effective income tax rates and the U.S. federal statutory rate of 21.0% was mainly due to state and foreign income taxes, certain permanent nondeductible costs, and the effects of certain discrete items recorded during the period, including one-time items related to the Olympic Steel Merger.

Earnings (loss) per share. The changes in earnings per share are due to the results of operations discussed above. In addition, we issued 19.5 million shares of common stock to complete the Olympic Steel Merger on February 13, 2026, partially offset by share repurchases of 113,733 shares since January 1, 2026.

Liquidity and Cash Flows

Our 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.

We had cash and cash equivalents of $41.9 million at June 30, 2026, compared to $26.9 million at December 31, 2025. Our total debt outstanding at June 30, 2026 increased to $955.2 million compared to $463.1 million at December 31, 2025 as a result of the merger with Olympic Steel and net cash used in operating activities in the first six months of 2026. We had a debt-to-capitalization ratio of 42% and 38% at June 30, 2026 and December 31, 2025, respectively. We had total liquidity (defined as cash and cash equivalents and availability under the Ryerson Credit Facility and foreign debt facilities) of $757 million at June 30, 2026 versus $502 million at December 31, 2025. Our net debt (defined as total debt less cash and cash equivalents) was $913 million and $436 million at June 30, 2026 and December 31, 2025, respectively. The comparability of our cash, debt, and liquidity positions as of June 30, 2026 to December 31, 2025 is significantly affected by the acquisition of Olympic Steel, which closed on February 13, 2026. As part of purchase consideration in the merger, Ryerson paid $270.0 million, net of cash acquired, to extinguish Olympic Steel's existing debt and to settle certain outstanding performance based stock units that converted to cash upon close of the transaction and resulted in the consolidation of Olympic Steel's operations, assets, and liabilities beginning on the closing date. 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 profile. Net debt should not be used as a substitute for total debt outstanding as determined in accordance with GAAP.

Below is a reconciliation of cash and cash equivalents to total liquidity:

(In millions)

Below is a reconciliation of total debt to net debt:

(In millions)

Of the total cash and cash equivalents as of June 30, 2026, $15.5 million was held in subsidiaries outside the U.S. which 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 earnings held in foreign jurisdictions, which could result in higher effective tax rates. 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.

The following table summarizes the Company’s cash flows:

(In millions)

Operating activities. 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. In the first six months of 2026, working capital requirements increased due to stronger demand and increasing metal commodity prices, which drove higher sales levels during the second quarter of 2026 compared to the fourth quarter of 2025, resulting in an increase in accounts receivables. Inventory increased in the second quarter of 2026 due to higher tons in inventory to meet increased demand as well as increased commodity price as of June 30, 2026 compared to December 31, 2025. Increased purchasing activity and higher payables balances caused by the increased metal prices discussed above, resulted in an increase in accounts payable compared to fourth quarter of 2025. Additionally, book overdrafts fluctuated based on the timing of payments. In the first six months of 2025, working capital requirements increased mainly due to higher sales levels compared to the fourth quarter of 2024 driving an increase in accounts receivables. There was a slight decrease in inventory, as commodity price decreases caused lower inventory costs as of June 30, 2025 compared to December 31, 2024. Increased purchasing activity and timing of payments at the end of the second quarter of 2025 resulted in an increase in accounts payable.

Investing activities. The Company's main investing activities are acquisitions and capital expenditures. During the first six months of 2026, the Company paid $270 million, net of cash acquired, to complete the Olympic Steel Merger. The Company also recorded $5.5 million of proceeds from sale of property, plant and equipment, due to the sale of two buildings classified as held for sale in 2026.

Financing activities. The Company's main source of liquidity to fund working capital requirements is borrowings on the Ryerson Credit Facility. In the first six months of 2026, we increased credit facility borrowings to extinguish Olympic Steel's debt in conjunction with the Olympic Steel Merger. Additionally, credit facility borrowings increased in the first six months of 2025 and 2026, to fund higher working capital requirements due to increased demand in the second quarter compared to the fourth quarter. Cash dividends paid increased from $12.0 million in the first six months of 2025 to $19.4 million in the first six months of 2026 due to higher shares outstanding after 19.5 million shares were issued to complete the Olympic Steel Merger. In the first six months of 2026, we paid $8.3 million in fees related to amending the Ryerson Credit Facility and we repurchased $2.4 million of common stock.

Off-Balance Sheet Arrangements. 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 approximately $7 million and $8 million, respectively as of June 30, 2026. 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.

Capital Resources

We believe that cash flow from operations and proceeds from the Ryerson Credit Facility will provide sufficient funds to meet our contractual obligations and operating requirements in the normal course of business.

Total debt in the Condensed Consolidated Balance Sheet increased to $955.2 million at June 30, 2026 from $463.1 million at December 31, 2025, mainly due to cash utilized to pay off Olympic Steel indebtedness upon the close of the Olympic Steel Merger as well as increased working capital requirements due to increased customer demand under the combined business.

Total debt outstanding as of June 30, 2026 consisted of the following amounts: $962.0 million of borrowings under the Ryerson Credit Facility, $2.6 million of foreign debt, less $9.4 million of unamortized debt issuance costs. For further information, see Note 7: Long Term Debt in Part I, Item I - Notes to Condensed Consolidated Financial Statements.

Pension Funding

At December 31, 2025, pension liabilities exceeded plan assets by $33.1 million. Through the six months ended June 30, 2026, we have made $6.1 million in pension contributions and we anticipate an additional minimum required pension contribution of approximately $5.3 million in the remaining six months of 2026 under the Employee Retirement Income Security Act of 1974 (“ERISA”) and Pension Protection Act in the U.S. and Ontario Pension Benefits Act in Canada. Future contribution requirements depend on the investment returns on plan assets, the impact of discount rates on pension liabilities, and changes in regulatory requirements. We are 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 our financial position or cash flows.

For further information regarding our pension and postretirement benefit plans, see Note 8: Employee Benefits in Part I, Item I - Notes to Condensed Consolidated Financial Statements.

Changes in returns on plan assets may affect our plan funding, cash flows, and financial condition. Differences between actual plan asset returns and the expected long-term rate of return on plan assets impact the measurement of the following year’s pension expense and pension funding requirements. However, we believe that cash flow from operations and the Ryerson Credit Facility described above will provide sufficient funds to make the minimum required contributions.

Material Cash Requirements

We expect to make approximately $965 million in principal payments to satisfy our debt obligations, consisting of $3 million in foreign debt coming due in the next twelve months and $962 million related to the Ryerson Credit Facility coming due in 2031. Please refer to Part I, Item I - Notes to the Condensed Consolidated Financial Statements, Note 7: Long-term Debt for further information.

We expect to pay approximately $48 million of interest on the Ryerson Credit Facility over the next twelve months and $175 million thereafter. Interest payments related to variable rate debt were estimated using the weighted average interest rate for the debt instrument.

We lease various assets including real estate, trucks, trailers, mobile equipment, processing equipment, and IT equipment. Non-cancelable operating leases expire at various times through 2045 and finance leases expire at various times through 2033. The total amount of future lease payments is estimated to be $480 million, with $58 million due over the next 12 months. We did not have any material leases signed but not yet commenced as of June 30, 2026.

Income Taxes

We maintain a valuation allowance on certain foreign and U.S. federal deferred tax assets until such time as in management’s judgment, considering all available positive and negative evidence, and consistent with its past determinations, we determine that these deferred tax assets are more likely than not realizable.

Market risk is the potential loss arising from adverse changes in market rates and prices. Our primary areas of market risk include changes in interest rates, foreign currency exchange rates, and commodity prices. We continually monitor these risks and develop strategies to manage them.

Interest rate risk

We are exposed to market risk related to our variable-rate long-term debt. As of June 30, 2026 and December 31, 2025, we have no publicly traded debt. The carrying value of our debt was $962.0 million and $463.2 million at June 30, 2026 and December 31, 2025, respectively. The carrying value approximates our fair value due to the short-term nature of the underlying borrowings on the Ryerson Credit Facility.

From time to time, we may use interest rate swaps to manage our exposure to interest rate changes. As of June 30, 2026, we have no outstanding interest rate swaps.

As of June 30, 2026, all of our debt is at variable interest rates. A hypothetical 1% increase in interest rates on variable debt would have increased interest expense for the first six months of 2026 by approximately $4.7 million.

Foreign exchange rate risk

We are subject to foreign currency risks primarily through our operations in Canada, Mexico, and China and we use foreign currency exchange contracts to reduce our exposure to currency price fluctuations. Foreign currency contracts are principally used to purchase U.S. dollars. We had foreign currency contracts with a U.S. dollar notional amount of $4.3 million outstanding at June 30, 2026 with a fair value of $0.1 million. We do not currently account for these contracts as hedges but rather mark these contracts to market with a corresponding offset to current earnings. For the six months ended June 30, 2026, the Company recognized a $0.2 million gain associated with its foreign currency contracts. A hypothetical strengthening or weakening of 10% in the foreign exchange rates underlying the foreign currency contracts from the market rate as of June 30, 2026 would increase or decrease the fair value of the foreign currency contracts by $0.4 and $0.5 million respectively.

The currency effects of translating the financial statements of our foreign subsidiaries are included in accumulated other comprehensive loss and will not be recognized in the Condensed Consolidated Statements of Comprehensive Income (Loss) until there is a liquidation or sale of those foreign subsidiaries.

Commodity price risk

In general, we purchase metals in an effort to maintain our inventory at levels that we believe to be appropriate to satisfy the anticipated needs of our customers based upon historic buying practices, customer contracts, and market conditions. Our commitments to purchase metals are generally at prevailing market prices in effect at the time we place our orders.

Metal prices can fluctuate significantly due to several factors including changes in foreign and domestic production capacity, raw material availability, metals consumption, and foreign currency rates. Fuel and gas prices can fluctuate based on input costs, economic conditions, international instability, and supply disruptions. Derivative financial instruments are used to manage a limited portion of our exposure to fluctuations in the cost of certain metal and energy commodities. No derivatives are held for trading purposes.

As of June 30, 2026, we had 54,869 tons of hot roll coil swap contracts with a net asset value of $1.5 million, 24,347 tons of aluminum swap contracts with a net asset value of $1.7 million, 623 tons of nickel swap contracts with a net liability value of $0.6 million, 6,575 tons of copper swap contracts with a net asset value of $9.1 million, 1,064,000 gallons of diesel fuel contracts with net asset value of $1.1 million, and 79,240 gallons of natural gas contracts with zero value. We do not currently account for these swaps as hedges, but rather mark these contracts to market with a corresponding offset to current earnings. For the six months ended June 30, 2026, the Company recognized a gain of $3.7 million associated with its metal and energy commodity derivatives, net of embedded customer derivatives.

A hypothetical strengthening or weakening of 10% in the commodity and energy prices underlying the derivative contracts from the market rate as of June 30, 2026 would increase or decrease the fair value of derivative contracts by $2.2 million.

Evaluation of Disclosure Controls and Procedures

The Company maintains disclosure controls and procedures that are designed to ensure that information required to be disclosed in its reports filed or submitted under the Securities Exchange Act of 1934, as amended, is recorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and forms and that such information is accumulated and communicated to management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow for timely decisions regarding required disclosure. In designing and evaluating the disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and management is required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures.

As required by SEC Rule 15d-15(b), the Company carried out an evaluation, under the supervision and with the participation of our management, including the Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of its disclosure controls and procedures as of the end of the period covered by this report. Based on the evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were effective as of June 30, 2026.

Changes in Internal Controls Over Financial Reporting

There have been no changes in the Company’s internal controls over financial reporting that have materially affected or are reasonably likely to materially affect the Company’s controls over financial reporting during the quarter ended June 30, 2026.

There have been no material changes relating to this Item from those set forth in Item 1A on the Company’s Annual Report on Form 10-K for the year ended December 31, 2025.