May 8, 2006 — Ryerson Inc. reported net income of $32.4 million on sales of $1.4 billion for the quarter ended March 31, 2006.

The $32.4 million net income ($1.12 per diluted share) compares with net income of $35.4 million ($1.37 per diluted share) for the first quarter of 2005, and net income of $6.3 million ($0.24 per diluted share) for the fourth quarter of 2005.

Results included a $21.0 million gain on the sale of assets ($0.44 per diluted share) from the sale of the company's U.S. oil and gas, tubular alloy, and bar alloy business. First quarter 2005 results included a $2.4 million restructuring charge ($0.06 per diluted share), while fourth quarter 2005 results included a $0.7 million restructuring charge ($0.02 per diluted share).

"We were pleasantly surprised with the strength of the market in the first quarter of 2006," said Neil S. Novich, Chairman, President, and CEO of Ryerson. "With strong market conditions and mill price increases, we realized higher prices as the quarter progressed. However, our volume in the quarter was affected by the loss of two large accounts — one of which went mill direct while the other relocated operations offshore. We continued to make progress on the Integris integration, with annualized cost synergies by first quarter end 2006 exceeding half of our $50 million target, offset mainly by inflationary increases in certain operating expenses."

Sales of $1.4 billion reflect a 6.0% decrease from the first quarter of 2005 and an 11.0% increase from the fourth quarter of 2005. Tons shipped declined 3.8%, while the average selling price was down 2.2%, year-over-year. Sequentially, tons shipped increased 4.6% and were down 1.9% on a per-day basis. The average selling price per ton increased 6.2% from the fourth quarter of 2005.

Gross profit per ton was $259, which compares to gross profit per ton of $276 in the first quarter of 2005 and $240 in the fourth quarter of 2005. Gross margin was 15.4%, which compares with gross margins of 16.0% in the first quarter of 2005 and 15.1% in the fourth quarter of 2005.

Operating expenses per ton were $181, which compare with operating expenses of $192 per ton in the first quarter of 2005 and $207 per ton in the fourth quarter of 2005. Operating expenses were reduced by $24 per ton, due to the gain on sale of assets. Excluding the gain, period expenses increased due to inflation in compensation and benefits; higher delivery expenses, largely from fuel costs; and a planned increase in SAP implementation costs.

Interest expense declined to $15.0 million in the quarter, compared to $19.2 million in the year-ago period and $16.3 million in the fourth quarter of 2005.

Financial Condition—Ryerson ended the first quarter with a debt-to-capital ratio of 59.3%, compared to 61.6% at year-end 2005. Availability under its credit facility was $614 million at the end of the first quarter, compared to $575 million at year-end 2005.

On March 13, 2006, Ryerson closed the sale of certain assets related to its U.S. oil and gas, tubular alloy, and bar alloy business. The sale yielded cash proceeds of approximately $50.2 million and a $4 million, 3-year note. A pretax gain of $21.0 million was recorded.

On March 13, 2006, approximately 540 union employees returned to work, ending a strike that began on March 6, 2006 at the company's Chicago-area facilities. Representatives of the company and the union continue to negotiate a new contract.

Outlook—"While market conditions remain strong, we are experiencing some spot shortages as mill lead times extend and imports are becoming less available," concluded Novich. "We continue to make progress rolling out SAP and realizing the synergies of the Integris acquisition."

Ryerson Inc. is North America's leading distributor and processor of metals, with 2005 revenues of $5.8 billion. The company services customers through a network of service centers across the United States and in Canada, Mexico, and India. On January 1, 2006, the company changed its name from Ryerson Tull, Inc. to Ryerson Inc.