DEF 14A: Reliance, Inc. Seeks Stockholder Approval for Director Elections, Executive Pay, Auditor Ratification, and Incentive Plan Amendment

Reliance, Inc. is holding its annual meeting on May 15, 2024, to vote on key proposals including the election of directors, executive compensation, auditor ratification, and an amendment to the incentive award plan.

Summary

• Reliance, Inc. is holding its Annual Meeting of Stockholders virtually on May 15, 2024.
• Stockholders of record as of March 28, 2024, are entitled to vote.
• The meeting will address the election of eight directors, an advisory vote on executive compensation, ratification of KPMG LLP as the independent auditor, and an amendment to the 2015 Incentive Award Plan to extend its duration by 5 years.
• The Board of Directors recommends voting FOR all nominees for director, FOR the advisory vote on executive compensation, FOR the ratification of KPMG LLP, and FOR the amendment to the incentive award plan.
• In 2023, Reliance achieved \$14.8 billion in sales and \$22.64 diluted earnings per share.
• The company's stock price increased 38% in 2023.
• The company returned \$718 million to stockholders through dividends and share repurchases in 2023.
• The company's capital expenditure budget for 2024 is \$425 million, with approximately two-thirds targeting growth initiatives.
• The company acquired Southern Steel Supply, LLC in May 2023, Cooksey Iron & Metal Company in February 2024, and American Alloy Steel, Inc. in April 2024.

Sentiment

Score: 7

Explanation: The document expresses a generally positive sentiment, highlighting strong financial performance and growth initiatives, but acknowledges some challenges in the current economic environment.

Positives

• Reliance achieved the second highest sales and earnings per share in its history in 2023.
• The company's stock price increased significantly in 2023.
• Reliance has a strong history of returning value to stockholders through dividends and share repurchases.
• The company is investing in growth through capital expenditures and acquisitions.
• Reliance has paid regular quarterly cash dividends for 64 consecutive years without reduction or suspension and has increased its dividend 31 times since its 1994 IPO.
• The company's 2023 Total Recordable Incident Rate (TRIR) of 1.96 was significantly lower than the 2020 Metals Service Center Institute (MSCI) average of 3.5.

Negatives

• Net sales of \$14.81 billion declined 13.0% in 2023 compared to record levels of \$17.03 billion in 2022 due to a decline in the average selling price per ton sold of 16.4%.

Risks

• The document mentions ongoing inflationary headwinds and declining metal prices as challenges in the environment.
• The document mentions potential risks related to the Infrastructure Bill, the CHIPS Act, and the Inflation Reduction Act, as well as the onshoring and near-shoring activities in the markets they serve.

Future Outlook

Longer-term, the company remains excited about the many growth prospects anticipated under the Infrastructure Bill, the CHIPS Act, and the Inflation Reduction Act, as well as the onshoring and near-shoring activities in the markets they serve.

Management Comments

• We would like to express our gratitude to the entire Reliance family for our strong performance and forward progress in 2023 and for placing safety at the forefront of our operations.
• We thank our loyal and valued customers for relying on us for quick and accurate deliveries of high-quality products, and we are grateful for the longstanding relationships with our suppliers who continue to support us through all market cycles.
• We also appreciate our stockholders and their confidence in our future as our stock price reached new heights, increasing 38% in 2023, and representing a 17.6% compound annual growth rate since our IPO in 1994.
• We are pleased that our new identity captures the essence of who we have always been and always will be.
• We are more than metal. We are industrial strength.

Industry Context

The company outperformed the industry in terms of tons shipped growth, increasing 3.7% compared to the industry increase of 1.5% as reported by MSCI.

Comparison to Industry Standards

• The company's 2023 Total Recordable Incident Rate (TRIR) of 1.96 was significantly lower than the 2020 Metals Service Center Institute (MSCI) average of 3.5.
• The company's revenues, stock market capitalization, enterprise value and invested capital generally approximate the median of the executive compensation peer group companies.
• The company's Pretax Income Margin ranked at the 54th percentile in 2023 compared to the executive compensation peer group.
• The company's return on total assets ranked at the 71st percentile in 2023 and 80th percentile for the five-year period ended December 31, 2023 compared to the executive compensation peer group.

Related Party Transactions

• In 2023, the company employed two individuals Grant Hoffman and Ryan Mollins who are immediate family members of current or former executive officers during 2023 and/or directors and whose individual aggregate compensation and benefits paid by the Company in 2023 exceeded \$120,000.

Stakeholder Impact

• Stockholders: The company is committed to delivering increased value through dividends and share repurchases.
• Employees: The company is committed to employee health and safety and providing a safe environment where employees are proud to work.
• Customers: The company is committed to delivering exceptional service to customers.
• Communities: The company is committed to positively contributing to the communities in which they live and work.

Next Steps

• Stockholders to vote on proposals at the Annual Meeting on May 15, 2024.
• The company will continue to execute its capital allocation strategy, including investments in growth and stockholder returns.
• The company will continue to monitor and address potential risks related to the economic environment and regulatory landscape.

Key Dates

Keywords

Reliance, stockholders, directors, compensation, KPMG, incentive plan, annual meeting, governance, acquisitions, dividends, share repurchases, metal