Ryerson (NYSE:RYI) executives said the company entered 2026 with improving demand indicators and early momentum in pricing, while also beginning integration work following the closing of its merger with Olympic Steel one week before the call.
Chief Executive Officer Eddie Lehner opened the fourth-quarter 2025 earnings call by welcoming former Olympic Steel leaders joining the combined company, including President and Chief Operating Officer Rick Marabito, Senior Vice President of Finance Rich Manson, and Executive Vice President Andrew Greiff. Lehner said the combined organization now has more than 6,000 employees across approximately 160 locations and is “off to an excellent start” in integration.
Merger integration and synergy target
Looking ahead, Lehner outlined priorities for 2026 that include integrating operations while maintaining customer experience and culture, executing on service-center fundamentals to improve earnings quality, and reducing leverage to within a targeted range. He added that updated shareholder capital allocation plans would coincide with synergy attainment.
Market conditions and shipment trends
Chief Financial Officer Jim Claussen said North American industry volumes, as measured by the Metal Service Center Institute (MSCI), declined seasonally in the fourth quarter, falling 5.8% sequentially and down 1.5% for full-year 2025 versus 2024.
Claussen said Ryerson’s North American shipments decreased 6.8% sequentially in the quarter, but the company’s full-year shipment performance indicated market share gains despite a fourth-quarter retracement tied to “majorly depressed OEM program demand and shipments.” Total company tons shipped were down just under 5% quarter-over-quarter (in line with guidance) and were about 3% higher than the fourth quarter of 2024. For the full year, total company tons shipped were slightly ahead of last year, up about 0.5 percentage points.
Following a review and realignment of end-market classifications, Claussen said the company saw the most year-over-year volume growth in:
- Fabrication and welding
- Machine shop
- Machinery and equipment
Those gains were partially offset by weakness in commercial transportation and, to a lesser extent, the climate sector (including HVAC) and heavy equipment (including agricultural and construction equipment).
Fourth-quarter results impacted by rapid material cost inflation
Management said the fourth quarter was negatively affected by commodity price increases that rose faster than anticipated and outpaced the company’s ability to push higher pricing through to customers before the quarter ended. Lehner described the quarter as one in which supply-side price drivers outpaced buyer absorption while demand remained “subdued and contractionary.” He added that customer contract pricing lags and transactional price stagnation prevented supply-driven increases from showing up in end markets by quarter end.
Ryerson reported net sales of $1.1 billion in the fourth quarter of 2025, down about 5% sequentially due to lower tons shipped, with average selling prices flat, according to Chief Accounting Officer Molly Kannan. Compared with the fourth quarter of 2024, net sales rose 9.7% as average selling prices increased 6.3% and tons shipped rose 3.1%.
Kannan said rapid price increases drove a LIFO expense of $22.5 million, above the company’s expected $10 million to $14 million and above the prior quarter’s $13.2 million. Gross margin contracted 190 basis points to 15.3%, while gross margin excluding LIFO contracted 100 basis points to 17.3%.
Warehousing, delivery, selling, general, and administrative expenses were $205.3 million, up $4.9 million sequentially, driven by advisory service fees related to the Olympic Steel merger. The company posted a net loss attributable to Ryerson of $37.9 million, or $1.18 per diluted share. Adjusted EBITDA excluding LIFO for the quarter was $20.4 million.
First-quarter 2026 outlook: higher shipments, margin expansion, and profit expected
Claussen said the company has seen “very strong activity” early in the first quarter of 2026 and expects tons shipped to be up 13% to 15% versus the fourth quarter. On a same-store basis, Ryerson expects revenue of $1.26 billion to $1.3 billion, with average selling prices flat to up 2% sequentially as fourth-quarter material price increases flow through the market and expand gross margins.
Ryerson expects to generate net income of $10 million to $12 million in the first quarter before merger-related fees, with expected LIFO expense of $6 million to $8 million and adjusted EBITDA excluding LIFO of $51 million to $54 million.
For Olympic Steel, management said it anticipates in the last six weeks of the quarter revenue of $260 million to $280 million and adjusted EBITDA excluding LIFO of $12 million to $13 million. On a combined basis, the company forecast first-quarter revenue of $1.52 billion to $1.58 billion and adjusted EBITDA excluding LIFO of $63 million to $67 million.
In the Q&A, Lehner said quoting and conversion rates have been the best seen in “a really long, long time,” while describing pricing as improving but still uneven by end market and customer. When asked about which products were slower to reflect higher input costs, Lehner said aluminum had been the slowest of the company’s three main commodity groups to “propagate through,” though he said that has been improving. He also said carbon pricing had begun to show upward momentum, while stainless and nickel had been pressured for “structural” and cyclical reasons but had “maybe caught a bid” in recent months.
On capital allocation, executives emphasized keeping focus on synergy delivery and deleveraging, while continuing the dividend. Claussen noted that, alongside the merger closing, the company extended the maturity of its revolving credit facility and increased capacity from $1.3 billion to $1.8 billion.
For the fourth quarter, Claussen said capital expenditures were $21 million, bringing full-year 2025 CapEx to $52 million. The company expects approximately $50 million in 2026 CapEx on a same-store basis, or $75 million including a prorated expectation for Olympic Steel.
Ryerson generated $113 million of cash from operating activities in the fourth quarter as seasonal working capital release more than offset the net loss. The company reduced debt by $37 million and said its leverage ratio decreased from 3.7x to 3.1x sequentially, moving toward its stated 0.5x to 2x target range. Ryerson ended the quarter with $502 million of liquidity.
The company paid $6.1 million in dividends, or $0.1875 per share, in the fourth quarter and announced a first-quarter dividend at the same per-share amount for the combined shareholder base. No shares were repurchased during the quarter, and $38.4 million remained on the repurchase authorization.
Lehner said the company plans to report next quarter on synergy progress and operating performance as integration continues.
About Ryerson (NYSE:RYI)
Ryerson, Inc is a North American metals distributor and processor serving a broad range of industrial and manufacturing end markets. Headquartered in Chicago, Illinois, the company supplies carbon steels, stainless alloys, aluminum, brass and copper products to customers across the United States, Canada and Mexico. Through its extensive branch network, Ryerson provides just-in-time delivery and comprehensive inventory management solutions to support complex production schedules and tight lead-time requirements.
In addition to raw material distribution, Ryerson offers a suite of value-added processing services, including laser and plasma cutting, plate burning, sawing, shearing, forming, drilling and welding.
