Steel Dynamics Q1 2026 Earnings Call - Record 3.6M Tons, $700M Adj. EBITDA, Aluminum Ramp Could Add $650 to $700M

Tom, Conference Call Operator: Good day, and welcome to the Steel Dynamics first quarter 2026 earnings conference call. At this time, all participants are in a listen-only mode. After management’s remarks, we will conduct a question and answer session, and instructions will follow at that time. Please be advised this call is being recorded today, April 21st, 2026, and your participation implies consent to our recording this call. If you do not agree to these terms, please disconnect. At this time, I would like to turn the conference over to David A. Lipschitz, Director, Investor Relations. Please go ahead.

David A. Lipschitz, Director, Investor Relations, Steel Dynamics: Thank you, Tom. Good morning, and welcome to Steel Dynamics’ first quarter 2026 earnings conference call. As a reminder, today’s call is being recorded and will be available on our website for replay later today. Leading today’s call are Mark Millett, Chairman and Chief Executive Officer of Steel Dynamics, Theresa Wagler, Executive Vice President and Chief Financial Officer, and Barry Schneider, President and Chief Operating Officer. The other members of our senior leadership team are joining us on the call individually. Some of today’s statements, which speak only as of this date, may be forward-looking and predictive, typically preceded by believe, expect, anticipate, or words of similar meaning. They are intended to be protected by the Private Securities Litigation Reform Act of 1995, should actual results turn out differently.

Such statements involve risk and uncertainties related to integrating or starting up new assets, the aluminum industry, the use of estimates and assumptions in connection with anticipated project returns, and our steel, metals recycling, fabrication, and aluminum businesses, as well as to general business and economic conditions. Examples of these are described in the related press release as well as in our annually filed SEC Form 10-K under the headings Forward-Looking Statements and Risk Factors, found on the Internet at www.sec.gov, and applicable in any later SEC Form 10-Q. You’ll also find any referenced non-GAAP financial measures reconciled to the most directly comparable GAAP measures in the press release issued yesterday entitled Steel Dynamics Reports First Quarter 2026 Results. Now, I’m pleased to turn the call over to Mark.

Mark Millett, Chairman and Chief Executive Officer, Steel Dynamics: Super. Thank you, David. Good morning, everyone. Thanks for sharing your time this morning for our first quarter 2026 earnings call. As reported, our teams achieved a very strong first-quarter financial and operational performance. Several highlights for the quarter included record quarterly steel shipments of 3.6 million tons. We saw significant progress within our aluminum operations. It really is exciting to see our vision coming to life there. We had adjusted EBITDA of $700 million, and again, most importantly, our teams continue to emphasize and keep safety top of mind. We have an amazing group of people that achieves best-in-class performance each and every day. Incredibly proud of the whole team. Our world-class safety culture continues to evolve and our team’s dedication to our take control safety philosophy is extraordinary. Out of some 135 SDI locations, 94% operated in the first quarter without one lost time injury.

I’m continually inspired by the commitment they have for one another. They consider themselves family and challenge the status quo each day. As always, we will never be satisfied until we achieve a zero-incident environment. Before I continue, I’d like to shift to Teresa and Barry for their commentary. Teresa?

Barry Schneider, President and Chief Operating Officer, Steel Dynamics1: Thanks, Mark. Good morning, everyone. Thank you for joining us this morning. For the first quarter 2026, our net income was $403 million, or $2.78 per diluted share, with adjusted EBITDA of $700 million. First quarter 2026 revenues were $5.2 billion and operating income was $538 million, higher than sequential fourth-quarter results, driven by higher realized steel pricing and record steel volumes. Our steel operations generated operating income of $557 million in the first quarter, a 73% sequential increase as average selling prices per ton increased $86. From an index perspective, average HRC pricing increased from an average of $850 per ton in the fourth quarter to $975 per ton in the first quarter today. Excuse me, in the first quarter. Today, it’s over $1,000. Barry will talk more about the markets in a moment. Value-added spreads to HRC have also improved.

As the largest coater in North America, this will especially be helpful to our forward performance. As a quick reminder, approximately 75%-80% of our flat-rolled steel business is linked to lagging price contracts, in aggregate, generally lagging two months. The most recent flat-rolled steel price increases will positively impact our second quarter results. Additionally, demand and related pricing for our long product steel is strong, with pricing also continuing to improve. From a metals recycling perspective, first quarter 2026 operating income was $47 million, or 155% higher than sequential earnings, based on higher pricing for both ferrous and non-ferrous scrap. Shipments were modestly lower in the first quarter due to inclement weather for several weeks in January and February.

Scrap flows are strong again, with expectations for seasonally increased shipments in the second and third quarters, in addition to increases related to further support of our aluminum operations. Our steel fabrication team achieved first quarter operating income of $90 million, aligned with fourth quarter results as a benefit from higher shipments was offset by the increase in steel input prices. Our fabrication business generally maintains between 10-12 weeks of steel inventory, which can tighten margins in a rising steel price environment. Our steel joist and deck demand remains solid, evidenced by very strong order activity, with March representing the current high point. We were with the Aluminum management team last week, and things are going incredibly well. That said, a quick reminder that we are still constructing and commissioning while we are in operational startup. Mark will provide specifics in a moment.

As for the related first quarter financial impact, earnings for aluminum were lower than we originally expected, with an operating loss of $65 million. Operating costs were significantly higher in January as the team experienced normal startup issues, necessitating a temporary pause in operations and a write-down of some inventory. Things were resolved quickly and are operating smoothly now, with increasing volumes already being realized. We generated cash flow from operations of $148 million in the first quarter. Cash was reduced by $120 million related to our annual company-wide retirement profit-sharing funding and an additional $150 million related to working capital growth, specifically associated with our new aluminum investment. We also experienced significant working capital growth related to increased pricing across our businesses, increasing both customer accounts and inventory values. Our cash generation is consistently strong based on differentiated circular business model and highly variable low-cost structure.

At the end of the quarter, we had liquidity of $2 billion, comprised of cash and investments of $800 million and our fully available unsecured revolver of $1.2 billion. During the first quarter, we invested $138 million in capital investments. We believe total investments for the entirety of 2026 will be in the range of $600 million. In the first quarter, we increased our cash dividend by 6% and repurchased $115 million of our common stock, with $687 million remaining authorized at the end of March. These actions reflect the strength of our capital foundation and consistently strong cash flow generation and our continued confidence in our future. Our capital allocation strategy prioritizes high-return growth, with shareholder distributions comprised of a base positive dividend profile that is complemented with a variable share repurchase program, while we remain dedicated to maintaining our investment-grade credit designation.

Our free cash flow profile was fundamentally changed over the last number of years from an annual average of $540 million from 2011 to 2015 to $2.4 billion for the most recent five-year period. If you exclude our growth investments related to our Texas steel mill and our new aluminum investment, the average is $3.2 billion per year. There’s more coming. We’ve invested over $5 billion in three primary organic growth investments, including our Texas mill, our value-added flat roll coating lines, and our aluminum investment. These projects have an estimated through-cycle annual EBITDA of approximately $1.4 billion. We placed ourselves in a position of strength to have a sustainable capital foundation that provides the opportunity for meaningful strategic growth and strong shareholder returns while maintaining our investment-grade metrics. I really want to give a shout-out also to our Biocarbon team.

Last week, we did something that I think probably hasn’t been done anywhere else in the world. We had, instead of a ribbon-cutting ceremony, we had a log-cutting ceremony. Kudos to that team. That’s doing very well as well. Barry.

Barry Schneider, President and Chief Operating Officer, Steel Dynamics: Thank you, Teresa. Our steel fabrication operations performed well in the first quarter of 2026, delivering strong earnings. Steel joists and deck order backlog was solid at quarter end, with December through March representing some of the strongest order entry we have seen in the past 18 months. This backlog extends into the fourth quarter of 2026. We continue to have high expectations for the business this year due to positive customer sentiment and quoting activity, continued manufacturing onshoring, and public funding for infrastructure and other fixed asset investment programs. The uplift from this macro environment could be considerable. Our steel fabrication platform provides meaningful volume support for our steel mills, particularly critical in softer demand environments, allowing us to operate at higher through-cycle utilization rates than our peers. This also helps mitigate the financial risks associated with lower steel prices.

Our metals recycling operations also performed well in the quarter as scrap prices increased during the quarter, more than doubling operating income. Congratulations to the team. They had some tough weather earlier in the year. The North American geographic footprint to our metals recycling platform provides strategic competitive advantage for both our steel mills and our scrap-generating customers. In particular, our Mexican operations strengthen the raw material positions of our Columbus and Sinton facilities. They also provide strategic support for aluminum scrap procurement for our flat rolled aluminum investments. Our metals recycling team is partnering even more closely with our steel and aluminum teams to expand scrap separation capabilities through enhanced processes and technology. This will help mitigate potential prime ferrous scrap challenges over time and provide a meaningful advantage in increasing recycled content in our aluminum flat roll products while expanding our earnings capabilities.

The steel team delivered a solid quarter with record shipments of 3.6 million tons. During the first quarter of 2026, domestic steel industry operated at an estimated production utilization rate of 77%, while our steel mills operated at 89%. We consistently achieve higher utilization due to our value-added product diversification, differentiated customer supply chain solutions, and the support of our internal manufacturing businesses. This higher through-cycle utilization is a key competitive advantage, supporting our strong and growing cash generation and best-in-class financial metrics. Regarding the flat-rolled steel markets, conditions continue to improve, supported by strong demand and lower imports. Lead times remain elevated and customers remain optimistic about the outlook. Specifically in flat-rolled steel, we see improving value-added spreads returning with the impact of the core trade cases that we won in 2025.

Long product steel markets continue to be strong in 2026, and we expect another solid year as demand and pricing remain favorable, particularly in structural steel and railroad rail, with our Columbia City and Roanoke both achieving record months in production. SBQ markets are also improving across the various sectors, with increasing manufacturing and energy product support. Regarding the steel market environments, North American automotive production estimates for 2026 are expected to be similar to 2025. Our specific automotive customer base has not only remained stable, but has provided opportunities for growth. We have become a supplier of choice for many U.S.-based European and Asian automotive producers, due in part to our lower carbon content capabilities. Non-residential construction remains strong, led by data centers and an increase in multifamily home building. Our platforms continue to benefit from ongoing onshoring activity and domestic manufacturing projects.

In the energy sector, oil and gas activity has been strong with the pipe mills already booked well into the summer, with solar continuing to remain strong in our order books. Overall, we remain optimistic considering demand for our diversified value-added steel products in the coming year. With that, I’ll return it to Mark.

Mark Millett, Chairman and Chief Executive Officer, Steel Dynamics: Barry, Theresa, thank you. As you can see, everyone, it’s been an incredibly good quarter. Great performance by everyone. Something to celebrate for sure. We’re also celebrating Barry’s birthday today. I just want to interject, and it’s rarely do we get donuts anymore in the office, and today was a special day. We’re celebrating that too. Again, the consistently sustained, the positive results, it just doesn’t happen, as I think you all realize, it’s the result of the strategies implemented and executed by the teams over time. We’ve continually invested strategically to drive scale of business, product market diversification, unique customer supply chains, and we’ve been linking operating platforms to optimize market opportunities throughout economic cycles. When combined with our performance-driven incentive culture, we consistently achieve at the highest levels compared to our peers.

Our foundational focus on market and product diversification into high margin value-added products drives higher through-cycle utilization and superior financial metrics. We optimize cash generation, allowing for a consistent and balanced cash allocation strategy that has consistently delivered strong shareholder returns. Our disciplined investment approach continues to support a strong and growing through-cycle cash generation profile, while maintaining one of the highest ROIC metrics among our industrial peers. At the moment, our largest such investment is in the aluminum flat-rolled products arena. When touring the facilities there, the excitement of the aluminum team is palpable as you watch them perform, now transitioning from construction and commissioning to production and serving the customers with high-quality products. They’re also constructively navigating a roiling aluminum market, manifest by the tragic impacts of the Iranian war and the domestic supply chain challenges.

Beyond these, hopefully near-term constraints, we’re also experiencing a unique and very favorable long-term market environment. There’s a significant and fundamental domestic supply deficit of over 1.4 million tons of aluminum sheet, and this deficit is forecasted to grow with additional demand in the coming years. In 2024 and 2025, that deficit was supplied through high-cost imports, which are now even higher as tariffs increased from 10% in 2024 to the current 50% level. This investment is a clear alignment with SDI’s core competencies. Our construction capabilities have once again been proven, both Columbus and our cast house in San Luis Potosí are state-of-the-art facilities, and they were brought on in record time compared to other facilities, and at a very reasonable cost on budget. Well, near to budget.

We’re using SDI’s deep operational know-how in combination with the technical expertise of aluminum industry experts, and our proven incentive-driven performance culture will drive higher efficiency and lower cost operations compared to our competitors. We also believe we have an advantaged commercial position. Two-thirds of our existing carbon flat-rolled steel customers also consume and process aluminum flat-rolled sheets. Our growth in the automotive sector will complement our existing steel position and provide customer material optionality. The beverage can market provides counter-cyclical market diversification, and a more stable earnings profile within the aluminum space will further enhance the consistency of our through-cycle cash generation. Our raw material platform will also facilitate high recycled content.

We’re the largest North American metals recycler, which includes aluminum, and we’ve successfully developed new separation technologies, allowing us to have more access to usable aluminum scrap at a lower cost. Production to date, even at its early stages, is already confirming our expected earnings differentiation. When the markets normalize, we’re confident in the through cycle EBITDA expectation for normalized markets again, remains at $650-$700 million, plus a further $40-$50 million for our recycling platform. As we’ve spoken in the past, the four key areas of advantage from a labor efficiency standpoint, higher recycled content, high yield, and optimized logistics. It’s all driven by a performance-based operating culture utilizing state-of-the-art equipment. This strategic investment is a cost-effective and high return growth opportunity, providing Steel Dynamics with additional chemical diversification while further stabilizing and growing our cash generation capabilities.

We’ve seen that the customer base is hungry for a new market entrant, one that is known to be innovative, customer-focused, and responsive. We view business relationships as long-term, founded on trust with a continuous goal of creating mutual value. Not simply just financial value, but we will provide new supply chain solutions, new products with preferred quality and service. Many customers have already experienced this through the actions we have taken to help solve some of the recent supply chain challenges. This has been fortuitous for us, allowing us to help the market while accelerating material qualification. For all that said, all startups have their challenges and I would like to thank our customers for their patience as we fine-tune our operations and continue our ramp up.

Today, we have received certifications from multiple customers for industrial and can sheet finished products, as well as certification for automotive aluminum hot band. What is incredible to me is that even finished automotive products are currently in the qualification process with several automotive customers. We believe we could receive acceptance in the coming weeks. This accelerated certification should allow us to shift our product mix to a higher margin mix this year, reaching the planned optimized mix of 45% can sheet, 35% automotive, and 20% industrial sometime in 2017. The hot side is fully operational now and has demonstrated the ability to run at full-rated capacity. The last of four preheat furnaces will be in service at the end of the second quarter, and we have successfully rolled 3,000, 5,000, and 6,000 alloys. Two of our three cold mills are now ramping operations and producing prime product.

The third cold mill is expected to begin producing in the third quarter. The cold reversing mill, in particular, is successfully producing shippable 303 or 3003, 5052, and 3104 products. The first of two automotive continuous anneal and solution heat treat lines, CASH lines, is now operational and producing material for qualification for automotive customers. The team has brought that particular line on in absolute record speed, and it truly is testimony to the team we have there. We believe we should receive qualification from several customers in the coming weeks. The second CASH line is expected to begin commissioning in the third quarter. The team is incredibly excited with the earlier-than-anticipated product certifications. Again, it is testament to the incredible talent we have been able to embed throughout the facility. There’s great energy and great momentum.

We’re extremely excited by the physical production and quality capability of the mill today, especially this early in the startup. We’re focused on achieving operational and quality consistency. We continue to believe we’ll be exiting 2026 at a monthly rate of 90% capacity. As we continue to be impassioned by our current and future growth plans, as they will continue to drive the high return growth momentum we have consistently demonstrated over the years. The earnings growth of our most recent projects is compelling. The capital funding for Sinton, the four value add lines, and Aluminum Dynamics is basically complete with a projected future through cycle EBITDA contribution of $1.4 billion a year. I’m excited as our teams, customers, investors recognize the power and consistency of our strong cash generation, combined with our disciplined high return capital allocation strategy.

It’s our belief that the steel industry has undergone a paradigm shift in recent years, supported by the pervasive sense of mercantilism that will provide a level playing field through continued and appropriate trade mechanisms. Fixed asset investment will continue to grow, which directly correlates with increased metal products demand. Reshoring of manufacturing continues to increase, and along with AI and cloud computing, will support non-residential construction, further strengthening what is an already robust long products market. Decarbonization itself will materially steepen the global cost curve, providing Steel Dynamics with a huge competitive advantage to gain market share and increase metal spreads. Our highly diversified value-added product capabilities provide us with a very unique advantage to leverage this evolving business environment and amplify our relative earnings capability.

In closing, I’ve said it a million times, I think, I never tire of saying it, that our people and our foundation are our foundation. I thank each of them for their passion and dedication. We’re committed to them, and I remind those listening today that safety for yourselves, your families, and each other is the highest priority. I’d be remiss not to thank our loyal customers, many of whom have supported us since our inception. These partnerships are based on trust, on doing what we say we will do, and creating new solutions to enhance the value proposition. Our new aluminum partners are experiencing the same. Also to our suppliers and service providers who we value and trust and work with each and every day. Thank you. We look forward to creating new opportunities for all of us today, and in the years ahead.

Thank you, and we’ll take questions now.

Tom, Conference Call Operator: Thank you. If you would like to ask a question, please signal by pressing the star key followed by the digit one on your telephone keypad. If you are using a speakerphone, please make sure your mute function is turned off to allow your signal to reach our equipment. If you pressed star one earlier during today’s call, please press star one again to ensure our equipment has captured your signal. Also, we ask that you please limit yourself to one question to facilitate time for everyone. Any additional questions can be addressed upon reentering the queue. Please hold a moment while we poll for questions. The first question this morning is coming from Albert Bellini from Jefferies. Albert, your line is live. Please go ahead.

Albert Bellini, Analyst, Jefferies: Hi. Good morning, all. Thank you for taking my question.

Mark Millett, Chairman and Chief Executive Officer, Steel Dynamics: Good morning, Albert.

Albert Bellini, Analyst, Jefferies: On aluminum, obviously a lot of external moving parts impacting fundamentals here. One, maybe if you could just talk through some of the impacts you expect to see on the business going forward from the recent change in tariff policy. Then I believe last quarter, you kind of briefly touched on mark-to-market margins being higher than what was used in calculating the guided through cycle EBITDA number for the business. Obviously since that point we’ve had some significant global supply impacts. Just wondering if you could provide any further color in terms of how much potential upside to those numbers you see at spot prices or margins. Thank you.

Mark Millett, Chairman and Chief Executive Officer, Steel Dynamics: Well, Albert, I’m not so sure our crystal ball is any clearer than yours far into the future. Obviously, the market today is absolutely phenomenal from a standpoint of entering a new facility. Qualifying our products quicker has been a very fortuitous thing. Margins today are obviously very, very strong, which is helping a startup ramp. I guess, from the performance today, looking at the yields, the efficiencies, et cetera, again, we would say we’re more than confident with the $650 million-$700 million of EBITDA per year. We can’t see any downside in the future.

Barry Schneider, President and Chief Operating Officer, Steel Dynamics1: Yeah. You’re spot on. The spreads that we use from a profitability standpoint, just market related for each of the product sets, are significantly lower than the spreads that are available today. Right now I think what we’d like to do is continue to have the teams perform incredibly well. There’s a significant difference and a significant benefit that would inure to us in today’s spread environment, that we think does have more of a structural shift. In the coming months, what we’d like to do is actually probably discuss what through cycle is. We think just like the steel industry went through a structural change and what that might look like, the aluminum industry as well. I would just say more to come on that.

Tom, Conference Call Operator: Thank you. Your next question is coming from Carlos de Alba from Morgan Stanley. Carlos, your line is live. Please go ahead.

Carlos de Alba, Analyst, Morgan Stanley: Yeah, thank you very much. Just staying on with the aluminum business. Congrats on the ramp up. I just wanted to maybe get a little bit more color on the issues that you faced in the past quarter, and related also to the inventory write-off that you had. Was that due to quality issues or maybe just more color in general on what happened in the business and what makes you feel comfortable that you have basically put those behind and will continue to ramp up the volumes? Thank you.

Mark Millett, Chairman and Chief Executive Officer, Steel Dynamics: Thank you, Carlos. Essentially, it was principally limited to the January. Leaked a little bit into February. You’re right, it was a quality issue. It was a stain on the product issue. Should have caught it, should have seen it, but it’s been resolved.

Barry Schneider, President and Chief Operating Officer, Steel Dynamics1: It wasn’t an equipment issue, Carlos. It was a practice issue.

Carlos de Alba, Analyst, Morgan Stanley: Got it. Okay. Maybe, if I may add, any views on how you might ramp up the volumes? Clearly, as you just mentioned, current prices are significantly above what everyone expected. The more you can produce and sell, the better. Any colors on that would be great. Thank you very much.

Mark Millett, Chairman and Chief Executive Officer, Steel Dynamics: Well, just as a ramp in Q4, we were around 14,000 tons, I think, of shipments, give or take a little bit. Q1, you saw it’s around 22,000. We’re expecting, with the exception of any unexpected

Barry Schneider, President and Chief Operating Officer, Steel Dynamics: qualify unexpected disruptions. We should be around, we think, 60,000-70,000 tons in the second quarter. We have, obviously, the cold reversing mill was running pretty well in the first quarter. We have the full addition of the first tandem mill, and that should change things dramatically down there.

Barry Schneider, President and Chief Operating Officer, Steel Dynamics1: I think to speak to the quality, just to reemphasize that, a majority of what we actually produced or shipped, I should say more accurately in the first quarter and will be in the second quarter as well, is can sheet. It’s high-quality material.

Tom, Conference Call Operator: Thank you. Your next question is coming from Timna Tanners from Wells Fargo. Timna, your line is live. Please go ahead.

Barry Schneider, President and Chief Operating Officer, Steel Dynamics2: Yeah. Hey, good morning. Wanted to see if you could provide a little more color about your mix. I know with the coated lines ramping up, how is that progressing? I didn’t hear the breakout. I don’t know if you still provide that. If so, that’d be helpful. Then if I could, a second question, just I know a lot of interest in what you’re thinking about in terms of uses of cash with the strong free cash flow outlook, the fall in CapEx. If you could provide some more color on that’d be great.

Barry Schneider, President and Chief Operating Officer, Steel Dynamics1: Excellent. Good morning, Timna. I’m sorry I was remiss. I think you’re specifically looking for the flat-rolled shipments. The first quarter flat-rolled shipments for hot band was 1,017,000 tons. Cold rolled was 151,000 tons, and coated was 1,530,000 tons. The four new value-added lines are actually operating incredibly well. Barry, percentage basis, do you have that?

Barry Schneider, President and Chief Operating Officer, Steel Dynamics: They’re operating at full capacity right now, and the markets that they service are the markets that were the most impacted by the court cases. We are enjoying high-quality production and making our customers happier, and making sure that we have the right stuff in all of our mixes like we normally do.

Barry Schneider, President and Chief Operating Officer, Steel Dynamics1: From a capital allocation perspective, we are focused on consistently doing what we’ve been doing, which we think has been really successful. It’s growing the business as our priority and then complementing that with a progressively positive dividend profile, which is complemented by the share repurchase program, which we’re still engaging in. I know we did take a bit of a pause in the first quarter related to the working capital growth that we saw coming, both for the new operations that we have, but also just because we’ve had increased pricing across the business. You should continue to expect to see the same.

Tom, Conference Call Operator: Thank you. Your next question is coming from Martin Englert, from Seaport Research Partners. Martin, your line is live. Please go ahead.

Martin Englert, Analyst, Seaport Research Partners: Hello. Good morning, everyone.

Barry Schneider, President and Chief Operating Officer, Steel Dynamics: Good morning.

Martin Englert, Analyst, Seaport Research Partners: I had a question on unit conversion costs. If you could just qualitatively touch on some of the positive, negative factors quarter-over-quarter, what moved higher, what moved lower? Curious if energy was any meaningful influence on the quarter?

Barry Schneider, President and Chief Operating Officer, Steel Dynamics: Martin, this is Barry. Yeah, we didn’t see any huge increases. We have seen some structural increases in things like paint. As far as energy goes, there was small boosts here and there, but not to a level that we’re concerned about. Despite what’s happening around the world, we have very good relationships and we’re very efficient with our energy. Our teams respond when there are immediate upsets in energy, but we’re able to continue running at very high rates of production, and otherwise, it’s not a major concern for what we’ve seen so far.

Barry Schneider, President and Chief Operating Officer, Steel Dynamics1: To Barry’s point, Martin, there’s nothing to point out except remember that product mix really does have a pretty significant impact when you’re viewing it from the outside in. Structural or long steel products just generally have higher conversion costs. As they continue to have really robust shipments and volumes because of demand, that does look from the outside in like our conversion costs are a bit higher.

Tom, Conference Call Operator: Thank you. Your next question is coming from Tristan Gresser from BNP Paribas. Tristan, your line is live. Please go ahead.

Barry Schneider, President and Chief Operating Officer, Steel Dynamics3: Yes. Hi. Thank you for taking my questions, and happy birthday, Barry. The question I have is on pricing. I just wanted to have your view on the market at the moment. If we look at a chart with historical steel prices in the U.S., upcycles have always been very brutal, big swings in prices, and this time it’s been very different. Very gradual price increases almost on a weekly basis. We’d like to have you, how do you explain that? And most importantly, is that improving, you think, the sustainability of the current rally? How do you view the supply and demand at the moment for flat-rolled and any risk of imports picking up, in the coming months and disrupt a bit the balance? Thank you.

Barry Schneider, President and Chief Operating Officer, Steel Dynamics: Tristan, when we look at the flat roll markets, we’re seeing our customers have more confidence. Certainly the tariff world we’ve been living in the last two years has had impacts. I think more importantly, a lot of our customers have seen that supply chains are very important. When we have discussions with our customers, our supply chain position being so local to many of the businesses and having diverse products. It allows us to engage with them on a longer term frame than just what we see in a quarter, perhaps half a year. We do have confidence that this market is strong. It’s demand driven. We do feel like the pricing has been responsive as capacity has gotten closer, ramped up across the industry. Getting imports that are unfairly dumped into this country were very significant.

Those are so disruptive, and there’s subsequent cases that have been filed regarding circumvention. All the steel tons that are at sea have to find a home. When you have a global interruption like we have right now, I’m very happy that we have Section 232 protections. The executive orders early in April that helped further define both steel products, aluminum products, as well as derivative products is very helpful because that encompasses the entire supply chain. I think we are feeling the results right now of our businesses in America picking up, and the supply chain excellence that we have is really taking hold. I feel like we have good position, and we’re strong, and we’re super excited about long products. There’s so many big projects out there that engineering and ownership of those projects is getting involved early with our long products team.

We continue to market our long products and our fabrication teams together. That allows us to establish positions with these projects, whether it’s pharmaceuticals or electric vehicle production or energy. We have solutions that help them. It’s a robust market we’re in. We hope globally, things calm down a little bit. Other than that, we’re doing our best to make our customers happy.

Tom, Conference Call Operator: Thank you. Your next question is coming from Katja Jancic. Kasia, your line is live. Please go ahead.

Katja Jancic, Analyst: Hi. Thank you for taking my question. Maybe on the Pig iron side, the prices are moving higher. Can you remind us how much of Pig iron do you currently import? And are there any potential mitigating factors you’re looking at taking?

Barry Schneider, President and Chief Operating Officer, Steel Dynamics: Katja, I’ll give you a brief overview. We only use pig iron at our flat-rolled mills. Our Butler Mill has its own technology for making liquid iron that takes care of about 90% of Butler’s needs. That liquid iron is actually produced from recycled iron oxide products, so it’s also a very sustainable product. When we look at the Columbus Mill and Sinton Mill, that’s our primary users of pig iron, and we will use anywhere between 12%-22%. We do that based on what the quality is required and the productivity is required for those products. What we do to mitigate that is really found through our relationships with Omni, our scrap provider. We have an incredible connection between the scrap and the steel side.

The scrap is continually cleaning the SHRED-1 product we call it, so that we know exactly what we’re going to get in the melting furnace when we want it. That’s a big part of being able to capture value in that supply chain. What we do to mitigate it is we put very clean, shredded product, very clean busheling, intentionally when we need it. We use pig iron to supplement that. We look at the cost every day and availability. We’ve been very good at buying. I think we keep good positions of pig iron. We’re aware of the working capital, so we also don’t just binge on it for sure. But I’m really proud of what the teams do between Omni on the scrap side and what our melt shops do. We got a great iron team in the middle that helps coordinate that.

It’s really a benefit of having a team so closely connected and free to make those decisions quickly. It’s real. Prices go up, but we continue to find better ways to minimize it and better ways to let our team do what they do best.

Tom, Conference Call Operator: Thank you. Your next question is coming from Samuel McKinney from KeyBanc. Samuel, your line is live. Please go ahead.

Barry Schneider, President and Chief Operating Officer, Steel Dynamics0: Hey, good morning.

Barry Schneider, President and Chief Operating Officer, Steel Dynamics: Good morning.

Barry Schneider, President and Chief Operating Officer, Steel Dynamics0: Hey, I think I’ll ask a brief question for Barry after he called out the solid results in structural and rail. It put up the best quarterly shipment number in a couple of years, and you guys noted demand there remains very strong. Maybe dig a little deeper into what’s driving the uptick in activity there and how the 2026 contract shook out versus last year.

Barry Schneider, President and Chief Operating Officer, Steel Dynamics: Well, on the long product side, I think the team even after all the years, our incentive-based system drives our people to make better things and more of them. That team has just been very efficient at putting together sequencing. Last month, the melt shop in cast was 200,000 tons, which is a difficult achievement in a long products mill because of the different sections they cast. The efficiency of operations helps them put the right backlog on the ground, put the right inventory in place. I can’t say enough about how the sales team, through the long products group, is working together to make sure that Roanoke, Cielo, West Virginia, and Columbia City are all equally represented to customers so that we can get the best positions to make what they need.

I think the optimization is really a part of just the ongoing challenge our mills operate with incentive. There’s been a shock to the railroad rail system over the last year. We were able to also increase some of those products with our customer base to help alleviate some other supply-side problems that existed in rail. It continues to be a good part of our product offering. We also, our SBQ mill with increased

Mark Millett, Chairman and Chief Executive Officer, Steel Dynamics: Sales and relationships through the automotive energy and other forging customers has also been purchasing from Columbia City. We’re able to work all the long products very efficiently together. I tell the guys, "Good decisions you made two, three years ago, you get to enjoy today." They continue to make tough decisions when they have to so that we can run better when we have a market in front of us. We’re excited about what we see. We don’t see it slowing down, and we’re happy to be engaging the projects early in the process. That helps with speccing and laying out the best solution through the fabricating networks.

Tom, Conference Call Operator: Thank you. Your next question is coming from Lawson Winder from Bank of America. Lawson, your line is live. Please go ahead.

Lawson Winder, Analyst, Bank of America: Fantastic. Thank you, operator. Good morning, Mark, Teresa, and Barry. Happy birthday, Barry.

Mark Millett, Chairman and Chief Executive Officer, Steel Dynamics: Thank you.

Lawson Winder, Analyst, Bank of America: Steel Dynamics. Look, you guys have never been one to pass up an opportunity for growth or expansion. I was just thinking, your prior discussion there of long products and all the opportunity there. Can you make a compelling case today for a material expansion in that long products market? I’m going to try and tack on a second sort of related question, which is, and I’ve brought it up on these calls before, but it’s just like the aluminum rolling market in the U.S. is, I think, a great opportunity. Today, with the benefit of now being really active in the market, same question. Do you see a case for investment by Steel Dynamics into that market as well for new capacity?

Mark Millett, Chairman and Chief Executive Officer, Steel Dynamics: Well, I think you know our team perhaps. It’s incredibly inspiring as to the opportunities and the ideas that they bring forth. We’ve got a broad pipeline of strategic opportunities, greenfield growth, for sure, across all the spaces. Aluminum Dynamics, for sure, has opportunity. We see an industry that was a little bit like the steel industry 30+ years ago, that they haven’t been able to earn the cost of capital consistently and reinvest in their facilities and grow. We would like to take advantage of that. There are products for sure, certain product lines that we feel we could invest in long-term. Obviously, there’s a massive supply deficit there, which will continue to grow. We do see tremendous opportunity in aluminum. At the same time, we’re a steel company, and the steel guys have got their own innovative projects.

We’re assessing them, and as we see fit, we will invest accordingly.

Tom, Conference Call Operator: Thank you. Your next question is coming from Bill Peterson from JPMorgan. Bill, your line is live. Please go ahead.

Ben Adon, Analyst, JPMorgan: Good morning. This is Ben Adon for Bill. Thank you for taking my questions.

Mark Millett, Chairman and Chief Executive Officer, Steel Dynamics: Good morning.

Ben Adon, Analyst, JPMorgan: I wanted to ask about steel substitution amid the elevated aluminum price environment. Over the past few weeks, we’ve heard from companies in both sectors actually that this may be starting to unfold. Given that Steel Dynamics now uniquely sits on both sides of the fence, are you hearing about this from your customers? Are you seeing any evidence of it to date?

Mark Millett, Chairman and Chief Executive Officer, Steel Dynamics: Well, the good thing there is we do have that optionality and can take advantage of whatever direction the market may go. We have not seen or heard of any substantial substitution, to be honest, Ben. I don’t believe you’re going to see it. The investments that the automotive companies have made in their production facilities is massive. You don’t change that overnight. The pricing environment that we see today will change for sure and will revert to a more normalized level at some point, albeit at a high level and a very good opportunity for us for Aluminum Dynamics.

Barry Schneider, President and Chief Operating Officer, Steel Dynamics1: I think even counter to the idea of substitution, there’s just been recent announcements from a major automotive producer where they’re adding additional aluminum in the auto bodies in the Midwest, and so they’ll be increasing demand from that perspective. I think that further supports the idea of lack of substitution.

Tom, Conference Call Operator: Thank you. Your next question is coming from Tristan Gresser from BNP Paribas. Tristan, your line is live. Please go ahead.

Barry Schneider, President and Chief Operating Officer, Steel Dynamics3: Yeah. Thank you for taking the follow-up. Just two quick one. I know you mentioned in December that the aluminum plant was EBITDA positive. I was wondering if you could share some information about March, if the plant was EBITDA positive in March already. Just regarding BlueScope, what is the situation at the moment? Are discussions still ongoing? What can you tell us? Yeah, that’d be it. Thank you.

Barry Schneider, President and Chief Operating Officer, Steel Dynamics1: Thanks, Tristan. From an aluminum perspective, the plant was not on a full quarter basis, EBITDA positive, but it was basically break even combined February and March, because we had that pause in January that made it difficult. They’re doing an incredible job now with full expectations for the remainder of the year to be very positive from an EBITDA perspective. Mark, do you want to handle the BlueScope question?

Mark Millett, Chairman and Chief Executive Officer, Steel Dynamics: Yeah. I think, obviously, we never talk with any great specificity as to what we’re doing from a strategic standpoint. Suffice it to say, we have an incredibly strong partnership with Ryan Stokes and the SGH organization. As you know, we presented what we consider a best and final sort of joint offer. It’s our belief it was absolutely full and fair, and that was back in February. As you have seen, that best and final offer was summarily rejected, and there’s been no constructive engagement by the company since.

Tom, Conference Call Operator: Thank you. Your next question is coming from Timna Tanners from Wells Fargo. Timna, your line is live. Please go ahead.

Barry Schneider, President and Chief Operating Officer, Steel Dynamics2: Yeah. Hey, I was going to also ask about BlueScope, and since you just addressed it, I guess I’ll try another angle. I think it’d be interesting to hear how you think about downstream versus steel growth versus maybe organic projects. I know in the way past, a long time ago, there was talk of a new plate mill. Plate’s really strong. Beams, I hear, are sold out. I think maybe are there other expansion opportunities there, or are you thinking about kind of more of a downstream approach? Just any color on how you’re thinking about your growth options generally would be great.

Mark Millett, Chairman and Chief Executive Officer, Steel Dynamics: Thank you, Timna. I think, again, our strategic philosophy hasn’t changed at all. We pursue and explore all opportunities. I can’t remember ever saying there might be interest in plate. Larry, are you here with an interest in plate, mate?

Barry Schneider, President and Chief Operating Officer, Steel Dynamics: Well, Sinton does address some plate needs. It’s part of the reason the technology was chosen.

Mark Millett, Chairman and Chief Executive Officer, Steel Dynamics: Yeah

Barry Schneider, President and Chief Operating Officer, Steel Dynamics: Yeah.

Mark Millett, Chairman and Chief Executive Officer, Steel Dynamics: Again, with Nucor’s entry there, I think that the plate market is well served. I believe our focus has been and will be sort of downstream, innovative ways to improve and bring value to the supply chain in different products that we’re not in today. Again, as you know, we’re not in business just to grow, to get bigger. We like to continue our focus on sort of value add differentiating products and supply chains. The team has a myriad of opportunities that continue to get explored. We took a little bit of a hiatus given our CapEx for Sinton and Aluminum Dynamics. Now that’s behind us. We will continue to explore those opportunities. In aluminum, it’s phenomenal where we could go.

Tom, Conference Call Operator: Thank you. That concludes our question and answer session. I’d like to turn the call back over to Mark Millett for any closing remarks.

Mark Millett, Chairman and Chief Executive Officer, Steel Dynamics: Well, thank you very much. Thank you for those still on the call. Again, those that have supported us in the past and do so today, we will endeavor to do our best to spend your money wisely, and continue to have the best shareholder return in the steel business. Our team, again, phenomenal job. It’s incredible what you do. You inspire me personally. Just make sure you’re safe. Look after each other out there. For those that help us each and every day, both customers and service providers, we can’t do it without you either. Thanks for your patience with us. I know we can be tough at times, but we’re doing tough, challenging things, and together we will succeed. Thank you, everybody. Appreciate your support. See you next quarter.

Tom, Conference Call Operator: Once again, ladies and gentlemen, that concludes today’s call. Thank you for your participation, and have a great and safe day.