Ladies and gentlemen, welcome to the 2020 year-end and fourth quarter results conference call for Russel Metals. Today's call will be hosted by Mr. Martin Juravsky, Executive Vice President and Chief Financial Officer, and Mr. John Reid, President and Chief Executive Officer of Russel Metals. Today's presentation will be followed by a question-and-answer period. At that time, if you have a question, please press star one on your telephone keypad. I'll now turn the meeting over to Mr. Martin Juravsky and John Reid. Please go ahead. Great. Thank you, operator. Good morning to everyone. I plan on providing a brief overview of the Q4 highlights and results, and then we'll open it up for some questions. If you want to follow along, I'll be using the PowerPoint slides that are on our website. Just go to the investor relations section, the conference call part of that website. If you go to page three, you can read our cautionary statement on forward-looking information. Before I go through some of the financial results, I want to just step back and discuss the past several quarters to put the prevailing environment a little bit into context. For starters, we couldn't be more proud of how the Russel team has navigated through some pretty unique business conditions over the past year. In some way, the challenges of 2020 create an opportunity to make a range of changes that will enhance our platform for years to come. There is a long list of recent team accomplishments, and has involved many people, but a quick summary includes, there were some business unit leadership changes in some key roles, capital structure improvements, portfolio streamlining, including rationalization of selected non-core assets, and growing of our business. We look at a lot of acquisitions as well as capital investment opportunities. It involves a fair amount of work to filter through the ones that are potential opportunities to find those that meet our return on capital criteria and our business fit criteria. We were able to bring a few of those things over the finish line in 2020, and believe there are many more opportunities on the coming in the years ahead. With that being said, why don't we go to page five, and let me begin by giving a little bit of an overview. If I reflect back on where things were at the end of Q3, there were some positive signals, and we had expectations about what was on the come. In Q4, we started to realize the rewards within our financial results, and we just highlight the word, started to realize the rewards. In terms of market conditions, steel prices have surged over the last four or five months amidst limited inventory in the supply chain, good in-market demand from a broad base of customers. These factors, when combined with inflated scrap prices, have supported the prevailing price environment. On our Q3 conference call, I discussed the lag effect of steel prices to other parts of the supply chain. That lag effect has now flowed into our part of the supply chain towards the latter part of Q4, and this favorable environment has continued into early 2021. In terms of controllable business initiatives, we are continuing to implement our multi-year roadmap to enhance the value-added part of our business. In late December, we announced and closed on the CAD 13 million Sanborn acquisition. Sanborn is a value-added processor with an operation in Pewaukee, Wisconsin. We are really happy to have the Sanborn team join the Russel family. It's a relatively small acquisition but is truly a hand-in-glove fit with our other Wisconsin-based operations. Sanborn is located only 20 mi from our Milwaukee facility, and we have a longstanding working relationship with them as both a customer as well as a supplier. We've only owned the business for probably around six weeks now, but the teams are working very well. The opportunities to cross-sell product are being realized, and the order backlog is very strong. The Trenton project was completed a few months ago, and the backlog of that business is also very strong. The bottom-line results are being realized. This expansion of our value-added business is a multi-year journey, and we'll continue to make progress into 2021 as we have a couple more projects on the go and that we expect to be operational by the middle part of this year. On the OCTG line pipe front, we made the decision around the middle part of 2020 to reduce that footprint and permanently pull back capital from that segment. The target reduction was about CAD 100 million, and we are hoping to get there by the end of 2021. As we'll talk about later in the financial results, the OCTG line pipe portion of the business has been an economic drain to our overall results, and we've been focused on addressing that issue. We reduced inventories by greater than CAD 30 million in each of Q3 and Q4, and we are confident of achieving our CAD 100 million target by the end of 2021. In Canada, we merged our two operations into one, and in the U.S., we are permanently selling down the inventories. We'd like to thank the staff within these groups. There are some tough decisions that have to be made in terms of streamlining the business, reducing costs, and reducing the capital deployed. In terms of liquidity and capital structure improvements, with CAD 106 million of cash from operating activities in Q4 and liquidity of over CAD 400 million, we are in really good shape. The cash generation during 2020 provided us with an opportunity to reshape our debt structure. In Q4, we completed a series of changes, with the net results being that we extended our maturities by several years, improved our credit profile, enhanced our flexibility, and reduced interest costs by about CAD 8 million a year. We go to page six, in terms of our financial results, top part of the page, to start with the income statement perspective. The change in results from Q3 to Q4 2020 involved top-line improvement across our businesses, but also bottom-line improvement when we strip out some of the noise. Revenues improved between Q3 and Q4 by CAD 56 million, and gross margins improved by CAD 22 million. Adjusted EBITDA came down from CAD 47 million- CAD 41 million, but it was impacted by a few factors. One of the positive contributors to EBITDA was relation to Wage Subsidies, which were CAD 8 million in the quarter, that was down from CAD 20 million in Q3. As we said before, this program worked well to provide a cushion until business conditions recovered and supported employment base during this transitionary period. It actually feels pretty good to say that this government support program will likely be very small in Q1 as business conditions are vastly improved. As negative impacts to EBITDA, our OCTG line pipe business was [uncertain] in Q4. I mentioned this before, we'll talk a little bit more about it in a second. There was a loss in Q4 from that part of the business, which was a little worse than Q3, as it included some additional inventory provisions of about CAD 3 million and a few one-time items. In addition, stock-based compensation had a mark-to-market impact of about CAD 4 million in Q4 due to the increase in our share price. This was higher than the CAD 2 million expense in Q3. In Q3, we had a property sale gain of CAD 6 million that positively impacted the Q3 results, but it was a non-recurring item. That result is if we do an apples-to-apples comparison between Q3 and Q4, our Q4 adjusted EBITDA improved. The below EBITDA items that impacted results include a non-cash write-off of CAD 1.3 million for deferred financing expense. This was related to the Q4 refinancing. This negatively impacted our Q4 interest expense, but the benefit from the refinancing will be visible starting in Q1 of 2021. Lastly, Q4 had a CAD 30 million non-cash charge related to a write-down of goodwill, intangible, and some fixed assets of our U.S. energy business. We are required to do impairment testing based upon defined accounting standards. From a disclosure standpoint, this impairment charge is the only difference between reported and adjusted results. If you want the details, we have a reconciliation of that amount on page three of our MD&A. From a cash flow perspective, we generated CAD 85 million from a reduction in working capital in the quarter. It's more of the same in Q4 versus other recent quarters in terms of the tight controls over our working capital management. The biggest shift was from inventories that came down by CAD 68 million. This CAD 68 million reduction was mostly from the focused effort to reduce capital within the energy segment as we reduced that footprint within the OCTG line pipe portion of it. CapEx at CAD 6 million continues to be modest below DD&A, and we see in around this level continuing into 2021. From a balance sheet perspective, net debt continued to decline from CAD 324 million at the end of Q3 to CAD 267 million at the end of Q4, a reduction of about CAD 57 million. For shareholders' equity, there's an accounting adjustment because of the Canadian dollar strengthening from end of Q3 versus end of Q4. Bottom line from a liquidity perspective is that we are north of CAD 400 million in terms of liquidity. Our capital structure is strong, our credit metrics are strong, and we're in very good shape. Overall, I'm very pleased to say that we've made good progress on a number of initiatives that have driven free cash flow, and I believe that we have more on the come. Lastly, we've declared a quarterly dividend of CAD 0.38 per share. If we go to page seven, we have our segmented information. The service centers did really well as the market improved. Our Q4 revenues, gross margins, and profitability within the service centers all improved versus Q3, and in particular improved during each month of Q4. From an end market perspective, the improvements are fairly broad-based across regions and end customers. Ton shipped were up in Q4 versus Q3 by a little bit, but substantially higher in December of 2020 versus December of 2019. December is normally a much softer month from a volume perspective due to the holiday period, but this December was well above our normal for what we typically see in December periods. Price realizations were up around 5% in Q4 versus Q3 as the lag effect of the steel price increases were starting to be realized through our parts of the supply chain. In energy, revenues picked up, but margins and operating profit declined. This comes back to the challenges within the OCTG line pipe segment in particular that I've mentioned a couple of times already. When we look at Q4 and 2020 as a whole and the disconnect between our field stores results being in the plus and our OCTG results being in the negative, you can see the drag that OCTG line pipe has created on our results and why we are shrinking the footprint for that business. That being said, we have seen impacts of steel price increases starting to flow through to this market, and we are encouraged about our path to reducing inventory in a prudent and economic manner. Distributors had a pretty good Q4 and also benefited from the rebound in the steel sector. If we go to page eight, we have our segmented inventory information to provide a frame of reference for some of our recent capital reallocation changes. If we focus on the middle pie chart and the one to the right, you can see that our segmented inventory has declined from CAD 862 million at the end of June to CAD 716 million at the end of December. This equates to a CAD 146 million reduction over the past six months. The majority relates to energy, which declined from CAD 470 million at the end of June to CAD 373 million at the end of December. Of that roughly CAD 100 million decline in energy inventories, around 2/3 of that came from the decline of our OCTG line pipe segment. As I said earlier, we are comfortable with our CAD 100 million target for reducing the capital in that business by the end of 2021, and we've made good progress over the last couple of quarters. At the same time, we expect to be cautiously redeploying capital in our service centers and Steel Distributor segment in response to favorable market conditions, but as I said, it is cautiously deploying working capital, but we are seeing an uptick in that business. Overall, we've made good progress in reallocating capital with more to come. I think when we show these charts at the end of 2021, it'll further demonstrate this evolving shift. Two final takeaway thoughts in relation to the market, one, in a relation to Russel, two, specifically. The market. The improvement that happened during Q4 has maintained itself into Q1 2021, and we are still seeing good demand, tight inventory in the supply chain, and strong margins across most of our business units in the service centers and Steel Distributor segment. Energy is getting a bit better, but it is playing from behind. Within Russel specifically, we've started on our journey to reshape the portfolio. We are really pleased with the progress to date and encouraged by the ongoing opportunities ahead of us. In closing, on behalf of John and other members of the management team, I would like to express our appreciation to everyone within the Russel family, their tremendous hard work during 2020, and we are confident that the heavy lifting that was done in 2020 will be rewarded in 2021 and the years ahead. That concludes my introductory remarks. Operator, if you'd like to open the floor for questions, we're available at this point. Thank you. Ladies and gentlemen, we will now begin the question-and-answer session. Should you have a question, please press the star followed by the one on your touchtone phone. You will hear a three-tone prompt acknowledging your request. If you are using a speakerphone, please lift the handset before pressing any keys. First question comes from Mona Nazir at Laurentian Bank. Please go ahead. Good morning. Congratulations on the results, and thank you for taking my questions. My first one's just on the margin side. Of the over 400 basis point margin expansion year-over-year, I'm just wondering how much is driven by the elevated price environment versus value add company specific initiatives or any other items. Yeah. Mona, good to talk to you. Again, there's definitely a mix there. We have the elevated price environment take hold. It's the transactional nature of our business. We're able to pass that on very quickly. We will continue to see the growth in our value-added. Again, as it moves up the ladder, steel prices become larger, we will see that impact, the value-added impact on that as a percentage basis overall will not grow in lockstep. We'll continue to add to it. Commercially, on the downside, as steel prices drop, it will prop that up. There's an offsetting result that's there. Again, we are seeing the impacts of both. Right now, it's predominantly led by the increase in pricing. Okay, that's helpful. I know that you stated in the prepared remarks that you have started "to realize returns of macro tailwinds." Would it be fair to say that margins into Q1 are perhaps expanding even further on a sequential basis? Have conditions improved from year-end to current point, or are they similar? Yeah. Thanks, Mona. They're continuing into Q1 at a better pace. Said in a slightly different way, when we look at Q4 as a whole, the average of Q4 was up over Q3, and the exit speed or the exit margins within Q4 were better than the average of Q4, and we see that continuing into Q1 so far. Okay, that's helpful. Thank you. Then in regard to the restructuring and the heavy contraction we've been seeing on the energy product side. As you continue to reduce the footprint on OCTG and line pipe exposure, I'm just wondering when can we expect that to turn a corner from a revenue and profitability perspective? Is Q2 for revenue an okay estimate, or could it be further out? Thanks. We're seeing a little bit of a disconnect there in line pipe and OCTG as, again, we're working through inventories that are in the industry as a whole. There was some overstocking based on the speed of the downturn. Line pipe is coming out. We're seeing pricing rise quickly. OCTG is following, but it's moving at a little bit slower pace due to there being some oversupply. We think that that will rebalance in Q1, lifting pricing as, again, the substrate being flat roll and plate in North America has gone up considerably, so we'll see that pricing lift. As we see that move forward into Q1, further into Q2, we think we'll see that reversal for the OCTG and line pipe. Obviously, the field stores are producing at a solid return right now for us, considering where they are in the cycle for oil and gas. Just to follow up on that. When we look at the OCTG line pipe in Q4, it generated negative CAD 8 million of operating loss. That should get better. Exact time, exact magnitude, we think CAD 8 million is a low watermark. Okay, that's great. Thank you. The last one from me is, I'm just wondering, has the current macro environment tailwind changed or shifted your strategy at all over the last couple of months, even on the M&A side? No, it hasn't. It's one of those things where our M&A strategy stays the same throughout cycles. Only thing that really changes, in my mind, is really the opportunities that are available and vendor expectations, but we try and be pretty consistent. We've looked at a lot of stuff over the last little bit, and I suspect we'll continue to look at a fair amount. It's what we can actually bring across the finish line. In many respects, it's less about changes in our behavior, changes in market, and what that does to vendor expectations. We continue to look very actively. Thank you. That's it from me. Thanks, Mona. Appreciate it. The next question comes from Michael Doumet at Scotiabank. Please go ahead. Hey, good morning, guys. Morning, Michael. Could you maybe start us off just by elaborating on the drivers that drove lower operating income in your field stores in Q4 versus Q3? Yeah. Well, I'd say some of it was driven by in Q3, we had a really good period, in particular on the Canadian side of the business that was a little bit lumpy. It wasn't so much of the Q4 by itself, but more a case of Q3 had some really good business that came to the table, in particular, some of the Trans Mountain work. Got it. What ended up happening in Q4, on the other side of it is, the U.S. business has had some challenges. While our Canadian business has contributed nicely in Q4, there were some struggles south of the border. When we talk about the impairment charge that we took in Q4, that was really driven south of the border in our [uncertain] business. There are some challenges that are going on. There is a little bit of a disconnect between the Canadian oil patch and the U.S. oil patch right now. That is some of the phenomenon that you saw in Q4. Some of the pullback was really a function of some of the macro challenges that are ongoing within the U.S. sector. Got you. Thank you. Maybe more broadly speaking, I'm trying to get a sense for the earnings power of this business, I can make a pretty educated guess on where the Metals Service Centers is gonna land in 2021 based on what we saw in 2018. It gets a little bit trickier with the energy product side. It doesn't sound like the earnings there will peak at the same time as the Metals Service Centers. Again, for the Energy Products business, any way you can size up the earnings power of that business when it's been fully restructured? Yeah. Let me take a shot at that, Michael. Obviously, the last couple of years has been really challenging for that part of the business and has been an earnings drag. We talked about - CAD 8 million loss in Q4. It also lost money in Q3 and back for the last couple of quarters. In some ways, for the last little bit, it's a little bit of addition by subtraction. Lower top line, but frankly, eliminating some of that negative drain. Even if we look past the last couple of years and a longer-term basis, at best that business was generating mid-single digit type returns. When we look at redeploying that capital over a multi-year basis, it has had mid-single digit type returns if we look at it over a five, six, seven-year basis. Over the last couple of years, it's been a negative drain. When you use those macro factors to put it into your model, by taking that capital and redeploying it somewhere else, it should be a lower top line, but a higher bottom line as a result. That makes sense. Yeah, Michael, just to add to that, the field stores that you're asking about specifically look and feel more like our service centers. There are different market drivers, obviously, that geared towards more toward oil and gas production and the timing of that. Again, the operational, once we have, again, right sized the OCTG and line pipe, the operational side of the field store should look and feel a lot more like our service centers for your model. Got you. It's probably early to talk about it, but it feels like 2022 might be better than 2021 for the Energy Products business. Yeah. Maybe if I can sneak one last in. On the distribution segment, again, that one did well in 2018. If I remember correctly, the ability to source international steel was a big driver to that success. With steel lead times extending beyond three months, is it a possibility that you replicate that success again in 2021? Yes. There's different dynamics out there right now with international steel, but no, there's definitely opportunities for that success. This one was driven, the supply chain was just depleted. From manufacturer, service center, to end user going through COVID, everybody drew their inventories down. As manufacturing ramped back up, original equipment manufacturing ramped back up, industrial, the supply chain was just really thin and there were opportunities for the pricing. In addition, scrap pricing went through the roof. That was the driver. As we move into Q1, you're looking at extended lead times out into May, as you mentioned. Again, the international market and the import market right now, there is not enough spread there that is really making it overly attractive for people to go out and then dive in with both fists because, again, there is just not enough spread if there is a pullback on this pricing. That's great. Thanks, guys. Great. Thanks, Michael. The next question comes from Michael Tupholme at TD Securities. Please go ahead. Thanks. Good morning. Hey, Mike. Hey. First question is just on demand levels and activity levels in the service centers business. You talked about a strong pickup, particularly toward the end of the fourth quarter. Your outlook makes it sound like that has continued into the early part of this year. I'm just wondering if it's possible to get a little bit more granular. Is the rate of year-over-year change that you're seeing through the early part of this year, has that accelerated? Is it better than what you saw at the end of last year? I think it's better than the fourth quarter overall because you see some typical seasonality in fourth quarter. Again, fourth quarter was strong for us, especially going into the end of the quarter into the December month, and we continue to see that. If you're looking for granularity, again, OEMs and industrial across the board have again picked up pretty dramatically across the board. Construction remains very steady and really remained steady throughout the pandemic, which was very impressive. The laggard continues to be energy, although it's improving, it's just at a much slower pace. That's helpful. Thanks, John. I guess, yeah, when I refer to granularity, I guess what I was looking for, and that's what you suggested is helpful. I guess I appreciate the seasonal weakness that you typically see in Q4. Just wondering from a year-over-year perspective, whatever you were seeing in terms of year-over-year improvement late in the year, is the rate of year-over-year improvement higher than that through the first part of this year? Or is it sort of consistent with what you were seeing right at the end of the year there? I'd say it's slightly up right now over where we were in December, but it's definitely improving. Again, we're so early in the quarter, it's a little difficult to tell. Right now, we just got January to look at, but we are seeing improvements. Okay. I think one of the other aspects, and this is perhaps why it's hard to look purely at volume at this point, is there's not a ton of inventory in the supply chain. I think the reality is demand is outstripping available inventory. Volume could probably be higher than it is if there was available inventory for it, and the net result of all that is the price environment we're in right now. There's just not a ton of inventory in the supply chain. Right. Make sense. You were asked about margins in this, overall, I guess, but also a lot of the strength is in the service centers business, in particular in the fourth quarter. Just so I'm clear, you had a very strong margin, 25% gross margin service center in the fourth quarter. I think that was the highest since first part of 2018. Was that entirely driven by the strengthening price environment that occurred through the fourth quarter and particularly toward the end of the year? I know there's a value-added aspect, but just to be clear on the fourth quarter, there was nothing unusual, it was really primarily price driven? Yeah. Yeah. Predominantly. Sorry, go ahead, John. Yeah, predominantly price driven. There was some lift that we're seeing in the value-added process, and as it continues to grow, but it was predominantly price driven, and it continues on in Q1 pretty strongly. Okay. The way to think about this going forward is it fair to say that given the fact that prices continue to strengthen into the first part of 2021, the gross margins we see early in the year here should actually be improved even further from that level you saw in Q4? Am I thinking about this directionally the right way? Spot on. Okay, perfect. Thanks. Then just in terms of the Energy Products business, you affirmed your [million-dollar] capital reduction target, so it doesn't sound like that's evolved in any way or you're thinking about that any differently. I'm just wondering if there has been any evolution you're thinking for that business. Either, I guess, getting more aggressive with some of the changes you might be planning or in turn, perhaps less aggressive in view of the fact that oil and gas prices have strengthened and it looks like certainly things have bottomed there and are getting better. I'm just wondering if, it sounds like there hasn't been any change in your capital reduction target, but in terms of site closures or any other aspects of how you view that business from a strategic perspective, has anything changed? It's really the tale of two sides of the border, and then a couple other dynamics that come in. Again, we merged two of our operations, our OCTG and line pipe into one and had an overhead reduction in Canada. We've initiated really an orderly liquidation of inventory in the United States. However, based on the pricing that we're seeing and what's working through the supply chain, as it cleans itself up in Q1, again, the entire chain was oversupplied. We're starting to see prices rise. As we continue to pull that inventory down, there's obviously margin opportunities that are there to reverse that business. It doesn't put us in a rush to get out of the business. If there were an opportunity to do so that was advantageous for our shareholders and obviously made economic sense for us, we would consider it, but there's no reason for a rush. [uncertain]. Again, right now, we're in a pretty good position in the States just to take our time and plot away unless an opportunity presents itself that, again, made economic sense for us. In Canada, we've continued to reduce our inventory, but it's running at a very nice clip right now in our Canadian operation. Frankly, with the new administration in the United States, their green energy push, we feel like that Canada will benefit from that in the latter half of 2021 and on into 2022, with potential growth in the oil production. It could benefit us there as well. Okay, thanks. Just one last one. Marty, if I understood correctly your comment about CapEx, what I took from what you said was that you expect sort of a similar run rate to what we saw in the last quarter, and I guess in 2020. You were around CAD 24 million-CAD 25 million for the year. Is that the kind of number we should be thinking about for 2021? Yeah. Very similar orders of magnitude. Correct. Okay. That's down a fair bit from where it was certainly in 2019, and I think even historically. Is that I don't know. I'm just trying to understand. It just seems a little bit low to me. Is that sort of a I guess maybe what changed? Why is it coming down relative to where it's historically been? Michael, as we shift more into this high-end value-added processing, a little bit of a honeymoon phase, if you will there for CapEx as far as depreciation on repairs. You got this new machinery coming in the first year or two, you're just not having to do a lot of things there as far as the repair side of the business, and that will eventually shift back out and then ramp back up on that side. As we look at some of our older machinery, not as effective, it's still running, we will shift that production over to more of the high-end equipment, and that will just have an end of life where we will actually just scrap that equipment as it gets further in the tooth there. You're just seeing a little bit of an oddity in that. Like I said, that honeymoon phase of equipment when everything's running perfectly. Okay, that makes sense. All right, thank you. Great. Thanks. The next question comes from Frederic Bastien at Raymond James. Please go ahead. Good morning, gentlemen. Hey, Fred. Good morning. It's encouraging to see how supportive the conditions and also your own momentum are entering 2021. If I look at consensus expectations, the average analyst expects Russel to earn about CAD 1.80 per share this year, which is more than double what you delivered last year. Does that number make you nervous? We don't spend a lot of time thinking about consensus forecast, to be perfectly honest. We focus on what we can control, and what we control is how we're running the business. What we're seeing right now in terms of market conditions is pretty good, and what we're seeing in terms of the things that are within our control, operating costs, value-added opportunities, is looking really good. We're quite optimistic, but we don't spend an awful lot of time trying to figure out what street expectations are for next year and whether they're too high or too low or just about right. We'll leave it to you guys to figure that one out. Yeah. I've been following you guys for 10 years. I can tell you it's quite hard. Directionally, we're obviously heading in the right direction. Very much so. I think that's a fair point, Fred. The [uncertain]. It was a pretty decent Q4, and the exit pace coming out of Q4 was better than the Q4 average. Some of the initiatives that were put in place in 2021, we're seeing the fruits of our labor, we're quite pleased about that. Maybe a question for John. I'm sure you're sleeping better than you were nine months ago or 10 months ago, unless you caught COVID more recently. Is there anything keeping you up at night right now? As we work through the energy, obviously that's difficult, Fred, just in the fact that we're dealing with our people and going through that's obviously difficult. From the service center side and the distribution side, we're really looking at some silver linings that happened in 2020. The development of our people was tremendous. They were thrust into some leadership roles, and they all responded just tremendously. Again, it just accelerated their leadership and their ability to grow this business going forward. As we go into 2021 with some momentum from the market at our back, our people are just so poised to take advantage of the opportunities, and they're doing a great job of maximizing those opportunities. The biggest thing is the challenges with the people in the OCTG and line pipe side. Okay. All right. Appreciate the call then. Thanks, guys. Great. Thanks, Fred. Thanks, Fred. Talk to you. Ladies and gentlemen, as a reminder, should you have any questions, please press star followed by one. Next question is from John Biggs, an investor. Please go ahead. Hi, gentlemen. How you doing? I keep looking at that dividend that you guys are paying out. I look at just from what I see, about roughly CAD 90 million. I know you guys have always been concerned about cutting the dividend. If you guys cut the dividend, I know you'd be concerned about the stock going down, but boy, that's a lot of cash flow going out of the company. My next question is, that's a question I'd really like you guys to look at. Have you guys got enough inventory also to take advantage of this next quarter with the inventories really being tight out there with source of supply and margins exploding? Have you got enough inventory to really capitalize on those margins? Thanks, John. From a liquidity standpoint, when we look at the dividend, again, for the long-term viability of the company and for the shareholder, when we look at it, we're in a solid liquidity, being the counter-cyclical cash flow. These downturns, we actually throw off so much cash that the dividend is sustainable for a pretty long period of time without being a concern to the balance sheet. We're pretty comfortable with that. In regards to inventory, we've always taken the approach that we're going to turn our inventory in both the U.S. and in Canada faster than our competitors. That kind of minimizes the ups and downs. Going into an increasing market, we actually did bulk up a little bit, not materially, on inventory, but we've got such a good working relationship, our projections forward on our buy side with our suppliers to go over guaranteed tons at the market price. The key for us is focusing on the margin side of the business and the gross margin. The transactional nature lets us push that in immediately and maximize on that because we're not bound by contractual nature. We can maximize those margins quickly. Where the challenge becomes is, again, you don't want to go out and start selling inventories to unusual places, and you have to protect your customers in this type of environment where some of the mills are on allocation. We've been able to do so. We've not had inventory concerns at this point. We do have some competitors that are running out of inventory. Supply is tight. Right now, we're in a very sweet spot on that. We're maintaining those turns where we've got, again, two to three months worth of inventory. When there is a downturn, we should be able to race to the bottom faster than anyone else. We think we're in a nice, sweet spot that really helps us maintain that earnings. Again, at the bottom, we're going to be at a higher peak. At the top, we may give away a few dollars on the top side. Again, it's nothing that's material to our share price or for shareholders. Just getting back to that dividend, that CAD 94 million going out the door, which is roughly, even with your stock at CAD 26.50, 5% of your margin. I just don't understand why that could not be used for more inventory, more acquisitions. I just look at that dividend and go, "Wow." It's a lot of dough going out the door. Yeah. It's Marty here. We look at it every quarter with our board, and we look at it holistically. At the end of the day, we're not being compromised with being able to walk and chew gum at the same time. We have invested, as required. We made an acquisition in the quarter. We've got a great capital structure with very strong credit metrics, and we paid a dividend. I think we're in a little bit of a sweet spot here right now in the sense of, you can do a variety of things in terms of capital allocation. I think, that's kind of evidence of what we've done this quarter. Little acquisition, continuing to manage working capital in the right way, and paying out a dividend and continuing to look at other opportunities for value-added investments within our business. We're checking a variety of boxes on that front. Okay, just one more thing about the margins. I know the margins you guys said in the fourth quarter, near the end were approaching 25%. With steel going up and flat- rolled and tubing and availability and tight supply, could the margins maybe get to close to 40% in the first quarter? We don't want to speculate on anything going forward [uncertain] forward-looking statement, but they definitely are improving. Okay. Thanks for your time, gentlemen. Great. Thanks, John. There are no further questions at this time. You may proceed. Great. Well, thanks, operator. We very much appreciate everybody for tuning in today. Thank you for taking the time. Thank you for following Russel. We appreciate it. If there's any follow-up items, please feel free to reach out to John or myself, either today or in the coming days. Otherwise, we look forward to staying in touch. Thanks, everyone. Ladies and gentlemen, this concludes your conference call for today. We thank you for participating, and we ask that you please disconnect your lines.