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Reliance demonstrated strong operational execution

throughout 2015 despite a very challenging economic

environment that continued to pressure metals pricing.

We achieved record cash flow from operations of $1

billion in 2015, affording us ample liquidity and financial

flexibility to continue to invest in our growth as well as

enhance stockholder value.

In early 2015, we outlined a company-wide plan to place

greater emphasis on inventory management. As part

of this effort, we successfully reduced FIFO inventory

by $433 million during 2015, which contributed to

increasing our 2015 FIFO gross profit margin to 26%,

up 40 basis points from 2014. Furthermore, we increased

our FIFO gross profit margin in each successive quarter

of 2015, ending the year with a fourth quarter 2015

FIFO gross profit margin 160 basis points higher than the

fourth quarter of 2014. Considering that metals pricing

declined sequentially in each quarter during the year,

this was an impressive accomplishment made possible

by the outstanding performance of the men and women

of Reliance. In addition to reduced inventory levels, we

believe that our focus on smaller order sizes and next day

delivery, coupled with the benefits of increased investments

in our value-added processing capabilities, contributed to

our gross profit margin improvements.

Our average order size in 2015 was $1,660, and we

delivered about 40% of our orders within 24 hours

of receiving the order from our customer. We lead the

industry in capital expenditure investments, with the

majority of investments focused on processing equipment

that expands the services we provide our customers. In

2015, we performed processing services on 47% of our

orders. We believe our customer service focused operating

model has enabled us to increase our market share as well

as to enhance our gross profit margins, and represents a

key differentiator of Reliance, especially as compared to

other large service center companies.

Our 2015 sales of $9.35 billion were down 10.5% from our

record sales of $10.45 billion in 2014. Demand declined

somewhat in 2015 compared to 2014, but was still relatively

healthy outside of the energy endmarket. Our same-store tons

sold declined only 3.2%, well ahead of the industry decline

of 7.5% reported by the Metals Service Center Institute. Tons

sold by our energy businesses were down 41% in 2015 from

2014 levels. Excluding the impact of the energy downturn,

our tons sold in 2015 were down only 0.7% compared to

2014. We believe Reliance has been able to growmarket share

in this challenging environment because our decentralized

structure places the day-to-day sales decisions in the hands of

our managers in the field and we have made industry-leading

investments in our facilities and equipment.