Russel Metals Announces 2026 First Quarter Results
Rhea-AI Summary
Russel Metals (OTC: RUSMF) reported record first-quarter 2026 results with revenues of $1,418 million and EBITDA of $124 million for the three months ended March 31, 2026. The company completed the sale of Delta (BC) property for $39 million (pre-tax gain $36 million), declared a quarterly dividend increase to $0.44 per share payable June 15, 2026, and exited the quarter with $500 million of available liquidity and $170 million net debt.
Contributions from the December 31, 2025 Kloeckner branch acquisition added $183 million revenue and $8 million EBITDA in Q1; shipments and U.S. revenue mix increased materially.
Positive
- Record revenues of $1,418 million in Q1 2026
- EBITDA of $124 million, up 44% YoY
- Sale proceeds of $39 million from Delta property (pre-tax gain $36 million)
- Dividend increased to $0.44 per share payable June 15, 2026
- Liquidity of $500 million and net debt of $170 million
Negative
- Comparable EBITDA reduced to $93 million after excluding $36M non-recurring gain
- U.S. operations now represent 53% of revenues, increasing geographic concentration risk
- Kloeckner branches contributed $8 million EBITDA on $183 million revenue, indicating lower margin contribution
Record Quarterly Revenues and Shipments
Revenues of
Solid Contributions from Kloeckner Asset Acquisition
Completed the Sale of Redundant Real Estate - Proceeds of
Declared an Increase in the Quarterly Dividend -
Strong Capital Structure - Liquidity of
Three Months Ended | |||
Mar 31 2026 | Dec 31 2025 | Mar 31 2025 | |
Revenues | $ 1,418 | $ 1,094 | $ 1,174 |
EBITDA 1 | 124 | 69 | 86 |
Net Income | 72 | 30 | 43 |
Earnings per share | 1.30 | 0.55 | 0.75 |
All amounts are reported in millions of Canadian dollars except per share figures, which are in Canadian dollars. |
Non-GAAP Measures and Ratios
We use a number of measures that are not prescribed by IFRS Accounting Standards ("IFRS" or "GAAP") and as such may not be comparable to similar measures presented by other companies. We believe these measures are commonly employed to measure performance in our industry and are used by analysts, investors, lenders and other interested parties to evaluate financial performance and our ability to incur and service debt to support our business activities. These non-GAAP measures include EBITDA and Liquidity and are defined below. Refer to Non-GAAP Measures and Ratios on page 2 of our Management Discussion and Analysis.
EBIT - represents net earnings before interest and income taxes.
EBITDA - represents net earnings before interest, income taxes, depreciation and amortization.
Liquidity - represents cash on hand less bank indebtedness plus excess availability under our bank credit facility.
Cash (for) from working capital - represents the change in non-cash working capital.
The following table shows the reconciliation of net earnings in accordance with GAAP to:
Three Months Ended | |||
($ millions, except per share data) | Mar 31 2026 | Dec 31 2025 | Mar 31 2025 |
Net earnings | $ 71.8 | $ 30.4 | $ 43.0 |
Provision for income taxes | 18.9 | 9.7 | 14.5 |
Interest (income) expense, net | 7.0 | 5.1 | 4.7 |
EBIT 1 | 97.7 | 45.2 | 62.2 |
Depreciation and amortization | 26.0 | 23.4 | 23.5 |
EBITDA 1 | $ 123.7 | $ 68.6 | $ 85.7 |
Basic earnings per share | $ 1.30 | $ 0.55 | $ 0.75 |
____________________________ |
1 Defined in Non-GAAP Measures and Ratios |
Our first quarter 2026 results reflected a continuation of improving trend line metrics as a result of favourable market conditions and the realization of benefits from our strategic initiatives.
- Revenues reached a record quarterly level of
$1.4 billion 21% increase over the first quarter of 2025 and a30% increase over the fourth quarter of 2025. - We completed the sale of a property related to our branch in Delta (BC) for cash proceeds of
$39 million $36 million $100 million - Our average gross margin percentage for the first quarter of 2026 was
21.3% , which was a slight improvement over the fourth quarter of 2025, despite the lower margin profile from the assets that were acquired from Kloeckner Metals Corporation ("Kloeckner") on December 31, 2025. On a same store basis, the average gross margin percentage for our metal service centers segment increased by 111 basis points in the first quarter of 2026 versus the fourth quarter of 2025. - In the first quarter of 2026, our EBITDA was
$124 million 44% increase over the first quarter of 2025, and an80% increase over the fourth quarter of 2025. After excluding the$36 million
($ millions) | Mar 31 2026 | Dec 31 2025 | Mar 31 2025 |
EBITDA | $ 124 | $ 69 | $ 86 |
Gain on sale | (36) | - | - |
Mark-to-market expense/(recovery) | |||
on stock-based compensation | 5 | 3 | (3) |
Total | $ 93 | $ 72 | $ 83 |
- The metal service centers segment had record shipments in the first quarter of 2026 despite severe weather conditions across most of eastern
Canada and theU.S. in late January. The first quarter 2026 tons shipped increased by32% over the fourth quarter of 2025, and18% compared to the first quarter of 2025 primarily as a result of the Kloeckner acquisition. On a same store basis, shipments in the first quarter of 2026 were up9% versus the fourth quarter of 2025. - In the first quarter of 2026, our
U.S. operations represented53% of our revenues and58% of our segment operating profits (excluding the impact from the gain on the Delta (BC) property) versus44% of revenues and45% of operating profits in 2025 and39% of revenues and36% of operating profits in 2024. This shift is the result of a series of targetedU.S. growth initiatives.
In the first quarter of 2026, we generated earnings per share of
During our 2026 first quarter, we generated
Market Conditions
Market conditions in the first quarter of 2026 were generally favourable, with demand being solid across most of our operating regions in combination with the benefits from steel price increases over the past several months. In the first quarter of 2026,
Capital Investment Growth Initiatives
On December 31, 2025, we closed the acquisition of seven branches in the
In the first quarter of 2026, we invested
Returning Capital to Shareholders
We have a flexible approach to returning capital to shareholders through: (i) our ongoing dividend; and (ii) share buybacks. In the first quarter of 2026, we paid
In the 2026 first quarter, we paid dividends of
In the first quarter of 2026, we purchased 0.15 million common shares at an average price per share of
Liquidity and Capital Structure
One of our key strategies is to maintain a strong capital structure in order to navigate through market cycles and be in a position to capitalize on opportunities. In March 2026, DBRS Morningstar reaffirmed our investment grade credit rating of BBB (low) with a stable trend, which is consistent with the S&P Global credit rating of BBB-. We ended the quarter with net debt of
Outlook
During the past several years, various tariff measures were imposed on steel and aluminum by the
Over the past several months, steel and aluminum prices have increased as a result of solid demand, ongoing tariffs that have limited international supply into
Over the medium-term, we expect to benefit from further rebuilding of the
Our energy field stores are expected to continue to benefit from solid energy activity in 2026. Our energy field store segment is also expected to continue to gain market share while maintaining a solid margin profile.
Investor Conference Call
The Company will be holding an Investor Conference Call on Wednesday, May 6, 2026, at 9:00 a.m. ET to review its 2026 first quarter results. To join the conference call without operator assistance, you may register and enter your phone number at https://emportal.ink/4IUNj8t. The dial-in telephone numbers for the call are 416-945-7677 (
A replay of the call will be available at 289-819-1450 (
Additional supplemental financial information is available in our investor conference call package located on our website at www.russelmetals.com/en/documents/conference-calls.
About Russel Metals Inc.
Russel Metals is one of the largest metals distribution companies in North America. It carries on business in three segments: metals service centers, energy field stores and steel distributors. Its network of metals service centers carries an extensive line of metal products in a wide range of sizes, shapes and specifications, including carbon hot rolled and cold finished steel, pipe and tubular products, stainless steel, aluminum and other non-ferrous specialty metals. Its energy field stores carry a specialized product line focused on the needs of energy industry customers. Its steel distributors operations act as master distributors selling steel in large volumes to other steel service centers and large equipment manufacturers mainly on an "as is" basis.
Cautionary Statement on Forward-Looking Information
Certain statements contained in this MD&A constitute forward-looking statements or information within the meaning of applicable securities laws, including statements as to our future capital expenditures, our outlook, the availability of future financing and our ability to pay dividends. Forward-looking statements relate to future events or our future performance. All statements, other than statements of historical fact, are forward-looking statements. Forward-looking statements are often, but not always, identified by the use of words such as "seek", "anticipate", "plan", "continue", "estimate", "expect", "may", "will", "project", "predict", "potential", "targeting", "intend", "could", "might", "should", "believe" and similar expressions. Forward-looking statements are necessarily based on estimates and assumptions that, while considered reasonable by us, inherently involve known and unknown risks, uncertainties and other factors that may cause actual results or events to differ materially from those anticipated in such forward-looking statements, including the factors described below.
We are subject to a number of risks and uncertainties which could have a material adverse effect on our future profitability and financial position, including the risks and uncertainties listed below, which are important factors in our business and the metals distribution industry. Such risks and uncertainties include, but are not limited to: volatility in product prices; cyclicality of the industry; future acquisitions; product claims; significant competition; sources of supply and supply chain disruptions; manufacturers selling directly; material substitution; failure of our key computer-based systems; cybersecurity; credit risk; currency exchange risk; restrictive debt covenants; the unexpected loss of key individuals; decentralized operating structure; labour interruptions; laws and governmental regulations; litigious environment; environmental liabilities; climate change; carbon emissions; health and safety laws and regulations; geopolitical risk and common share risk.
While we believe that the expectations reflected in our forward-looking statements are reasonable, no assurance can be given that these expectations will prove to be correct, and our forward-looking statements included in this MD&A should not be unduly relied upon. These statements speak only as of the date of this MD&A and, except as required by law, we do not assume any obligation to update our forward-looking statements. Our actual results could differ materially from those anticipated in our forward-looking statements including as a result of the risk factors described above and under the heading "Risk" later in this MD&A, and under the heading "Risk Management and Risks Affecting Our Business" in our most recent Annual Information Form and as otherwise disclosed in our filings with securities regulatory authorities which are available on SEDAR+ at www.sedarplus.ca.
If you would like to unsubscribe from receiving Press Releases, you may do so by emailing info@russelmetals.com; or by calling our Investor Relations Line: 905-816-5178.
Website: www.russelmetals.com
Three Months Ended | ||
(in millions of Canadian dollars, except per share data) | 2026 | 2025 |
Revenues | $ 1,418.3 | $ 1,173.6 |
Cost of materials | 1,115.6 | 921.2 |
Employee expenses | 143.4 | 113.0 |
Other operating expenses | 97.2 | 77.2 |
Gain on disposal of assets held for sale | (35.6) | - |
Earnings before interest and provision for income taxes | 97.7 | 62.2 |
Interest expense, net | 7.0 | 4.7 |
Earnings before provision for income taxes | 90.7 | 57.5 |
Provision for income taxes | 18.9 | 14.5 |
Net earnings for the period | $ 71.8 | $ 43.0 |
Basic earnings per common share | $ 1.30 | $ 0.75 |
Diluted earnings per common share | $ 1.30 | $ 0.75 |
Three Months Ended | ||
(in millions of Canadian dollars) | 2026 | 2025 |
Net earnings for the period | $ 71.8 | $ 43.0 |
Other comprehensive income (loss) | ||
Items that may be reclassified to earnings | ||
Unrealized foreign exchange gains (losses) on translation of foreign operations | 19.2 | (0.9) |
Items that may not be reclassified to earnings | ||
Actuarial (losses) gains on pension and similar obligations, net of taxes | (0.8) | (2.0) |
Other comprehensive income (loss) | 18.4 | (2.9) |
Total comprehensive income | $ 90.2 | $ 40.1 |
(in millions of Canadian dollars) | March 31 | December 31 |
ASSETS | ||
Current | ||
Cash and cash equivalents | $ 128.1 | $ 114.6 |
Accounts receivable | 712.1 | 554.2 |
Inventories | 1,071.3 | 1,084.2 |
Prepaids and other | 34.2 | 33.1 |
Income taxes receivable | 1.9 | 6.2 |
Assets held for sale | - | 4.9 |
Total | 1,947.6 | 1,797.2 |
Property, Plant and Equipment | 569.6 | 558.6 |
Right-of-Use Assets | 156.8 | 155.2 |
Deferred Income Tax Assets | 0.4 | 0.4 |
Pension and Benefits | 34.9 | 37.0 |
Financial and Other Assets | 4.9 | 5.1 |
Goodwill and Intangible Assets | 130.1 | 131.1 |
Total Assets | $ 2,844.3 | $ 2,684.6 |
LIABILITIES AND SHAREHOLDERS' EQUITY | ||
Current | ||
Accounts payable and accrued liabilities | $ 637.6 | $ 552.2 |
Short-term lease obligations | 29.7 | 28.5 |
Income taxes payable | 14.5 | 6.3 |
Total | 681.8 | 587.0 |
Long-Term Debt | 298.3 | 298.3 |
Pensions and Benefits | 1.4 | 1.5 |
Deferred Income Tax Liabilities | 22.3 | 25.8 |
Long-term Lease Obligations | 158.2 | 156.9 |
Provisions and Other Non-Current Liabilities | 34.1 | 26.2 |
Total Liabilities | 1,196.1 | 1,095.7 |
Shareholders' Equity | ||
Common shares | 508.0 | 509.4 |
Retained earnings | 961.2 | 919.7 |
Contributed surplus | 9.9 | 9.9 |
Accumulated other comprehensive income | 169.1 | 149.9 |
Total Shareholders' Equity | 1,648.2 | 1,588.9 |
Total Liabilities and Shareholders' Equity | $ 2,844.3 | $ 2,684.6 |
Three Months Ended | ||
(in millions of Canadian dollars) | 2026 | 2025 |
Operating Activities | ||
Net earnings for the period | $ 71.8 | $ 43.0 |
Depreciation and amortization | 26.0 | 23.5 |
Provision for income taxes | 18.9 | 14.5 |
Interest expense, net | 7.0 | 4.7 |
Gain on sale of property, plant and equipment | (0.1) | (0.2) |
Gain on disposal of assets held for sale | (35.6) | - |
Difference between pension expense and amount funded | 0.7 | 0.7 |
Interest paid net, including interest on lease obligations | (10.3) | (4.3) |
Cash from operating activities before non-cash working capital | 78.4 | 81.9 |
Changes in Non-Cash Working Capital Items | ||
Accounts receivable | (154.2) | (99.9) |
Inventories | 18.9 | (74.5) |
Accounts payable and accrued liabilities | 90.7 | 83.3 |
Other | (1.1) | (8.7) |
Change in non-cash working capital | (45.7) | (99.8) |
Income tax received (paid), net | (9.8) | 1.3 |
Cash from (used in) operating activities | 22.9 | (16.6) |
Financing Activities | ||
Issue of common shares | - | 0.3 |
Repurchase of common shares | (7.2) | (25.8) |
Dividends on common shares | (23.7) | (23.9) |
Decrease in bank indebtedness | - | (13.4) |
Issuance of long-term debt | - | 300.0 |
Deferred financing costs | - | (2.0) |
Lease obligations | (7.9) | (5.9) |
Cash (used in) from financing activities | (38.8) | 229.3 |
Investing Activities | ||
Purchase of property, plant and equipment | (18.1) | (28.9) |
Proceeds on sale of property, plant and equipment | 0.4 | 0.5 |
Proceeds on disposal of assets held for sale | 38.5 | - |
Cash from (used in) investing activities | 20.8 | (28.4) |
Effect of exchange rates on cash and cash equivalents | 8.6 | 0.3 |
Increase in cash and cash equivalents | 13.5 | 184.6 |
Cash and cash equivalents, beginning of the period | 114.6 | 45.6 |
Cash and cash equivalents, end of the period | $ 128.1 | $ 230.2 |
(in millions of Canadian dollars) | Common | Retained | Contributed | Accumulated | Total |
Balance, January 1, 2026 | $ 509.4 | $ 919.7 | $ 9.9 | $ 149.9 | |
Payment of dividends | - | (23.7) | - | - | (23.7) |
Net earnings for the period | - | 71.8 | - | - | 71.8 |
Other comprehensive income for the period | - | - | - | 18.4 | 18.4 |
Shares repurchased | (1.4) | (5.8) | - | - | (7.2) |
Transfer of net actuarial losses on defined benefit plans | - | (0.8) | - | 0.8 | - |
Balance, March 31, 2026 | $ 508.0 | $ 961.2 | $ 9.9 | $ 169.1 |
(in millions of Canadian dollars) | Common | Retained | Contributed | Accumulated | Total |
Balance, January 1, 2025 | $ 528.1 | $ 918.7 | $ 10.0 | $ 201.6 | |
Payment of dividends | - | (23.9) | - | - | (23.9) |
Net earnings for the period | - | 43.0 | - | - | 43.0 |
Other comprehensive loss for the period | - | - | - | (2.9) | (2.9) |
Share options exercised | 0.4 | - | (0.1) | - | 0.3 |
Shares repurchased | (5.8) | (20.0) | - | - | (25.8) |
Transfer of net actuarial losses on defined benefit plans | - | (2.0) | - | 2.0 | - |
Balance, March 31, 2025 | $ 522.7 | $ 915.8 | $ 9.9 | $ 200.7 |
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SOURCE Russel Metals Inc.