Mr. Marion Britton reports

RUSSEL METALS ANNOUNCES FIRST QUARTER RESULTS

Russel Metals Inc. had first quarter 2013 earnings of $22-million, or 36 cents per share on revenues of $822-million. These results compare with the earnings of $33-million or 55 cents per share on revenues of $803-million in the same quarter last year and are above the fourth quarter 2012 earnings of 34 cents per share.

Revenues in the company's metals service centre segment decreased 16 per cent to $359-million in the first quarter of 2013 compared with the 2012 first quarter due to lower demand levels. Gross margins at metals service centres improved from the 2012 fourth quarter and were slightly lower than the same quarter last year, reflecting the levelling-off of steel prices. Operating profit as a percentage of revenues was consistent with the fourth quarter last year at 5 per cent.

Revenues in the company's energy products segment for the first quarter of 2013 increased 42 per cent or $114-million to $389-million compared with the 2012 first quarter, aided by the Apex Distribution revenues, which were $118-million in the first quarter. Gross margins at energy products improved from both the 2012 fourth quarter and 2012 first quarter to 15.3 per cent from 13.1 per cent and 13.7 per cent, respectively, due to stronger operating margins at Apex Distribution. Operating profit as a percentage of revenues was 6.3 per cent.

Revenues in the company's steel distributors segment decreased by 26 per cent to $74-million in the 2013 first quarter compared with the 2012 first quarter due to lower demand levels. Operating profits for the first quarter of 2012 decreased to $5-million from $10-million for the 2012 first quarter.

Brian R. Hedges, president and chief executive officer, commented: "The volume decline experienced throughout the service centre industry was also felt by Russel Metals. The decline in volume in the first quarter impacted most sectors, and was exacerbated by fewer working days in 2013 due to the timing of the Easter holidays and inclement weather following the relatively mild weather experienced in 2012. The drop in Canada was more severe than the United States, and reflects the impact on the Canadian economy of the energy slowdown in Alberta for both the oil sands and conventional gas drilling activities. The gross margins in service centre are stabilizing, which is positive. In the energy sector, excluding Apex Distribution, pricing pressures continue and gross margins on pipe products declined further in the first quarter. We do not see any meaningful improvement in volumes at this time, and the energy sector will improve should the XL pipeline to the Gulf be approved."

Mr. Hedges further commented: "The performance of Apex Distribution was the bright spot in the first quarter and validated our strategic acquisition of this operation. Apex Distribution has maintained a more stable earnings pattern despite the slowdown in the Western Canada energy sector. One of our goals in acquiring Apex Distribution was to reduce the volatility of our energy products segment, and this was demonstrated in the first quarter."

The board of directors approved a quarterly dividend of 35 cents per common share payable on June 14, 2013, to shareholders of record as of May 24, 2013.

The company will be holding an investor conference call on Friday, May 3, 2013, at 10 a.m. ET to review its 2013 first quarter results. The dial-in telephone numbers for the call are 416-340-2216 (Toronto and international callers) and 1-866-226-1792 (United States and Canada). Please dial in 10 minutes prior to the call to ensure that you get a line.

A replay of the call will be available at 905-694-9451 (Toronto and international callers) and 1-800-408-3053 (United States and Canada) until midnight, Friday, May 17, 2013. You will be required to enter passcode 7908038 in order to access the call.

            CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS
           (in millions of dollars, except per-share data)

                                                    Quarters ended March 31,
                                                         2013          2012

Revenues                                         $      821.8  $      802.9
Cost of materials                                       677.9         659.0
Employee expenses                                        62.5          58.2
Other operating expenses                                 39.9          32.9
Earnings before interest, finance
and provision for income taxes                           41.5          52.8
Interest expense                                          8.8           6.7
Interest income                                          (0.1)         (0.4)
Other finance expense                                     1.6           0.4
Earnings before provision for income taxes               31.2          46.1
Provision for income taxes                                9.5          13.2
Net earnings for the period                      $       21.7  $       32.9
Net earnings attributed to
Equityholders                                    $       21.6  $       32.9
Non-controlling interest                                  0.1             -
                                                 $       21.7  $       32.9
Basic earnings per common share                  $       0.36  $       0.55
Diluted earnings per common share                $       0.36  $       0.53 

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