Reliance Steel, RS, provides value-added metals processing services and distributes more than 100,000 metal products.
The company has grown profits and dividends at a 13-15% rate and earned a 7-19% return on equity over the last ten years. RS operations were under significant pressure from declining volume and increasing price competition in 2009. However, profits begun growing again as a result of:
(1) despite slow economic growth, it is witnessing improvement in its core customer base (aerospace and energy) resulting in both rising demand and prices,
(2) acquisitions (latest: McKey and National Specialty Alloys),
(3) an excellent cost control discipline.
