Good morning, ladies and gentlemen, and welcome to the first quarter 2021 results conference call for Russel Metals. Today's call will be hosted by Martin Juravsky, Executive Vice President and Chief Financial Officer, and Mr. John Reid, President and Chief Executive Officer of Russel Metals. Today's presentations will be followed by a question and answer period. At any time, if you have a question, please press star one on your telephone keypad. I would like to turn the meeting over to Mr. Martin Juravsky. Please go ahead, sir. Great. Thank you, operator. Good morning, everyone. I plan on providing a brief overview of the Q1 results. 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 of the website. If you go to page three, you can read our cautionary statement on forward-looking information. Let's start on page five. To give you an overview, the past four quarters has illustrated a full economic cycle. It's important to note that our financial performance has been robust in both the challenging times and now in a stronger market. That strong market performance is both absolute as well as when we benchmark ourselves against our service center peers. In the challenging quarters, we generate a lot of cash flow from working capital by managing inventories in a very prudent manner. The Q1 results reflect how well and quickly our business can adapt to and benefit from strong market conditions. As we look back on 2020, it was a really busy year as we advanced a series of initiatives like value-added CapEx, portfolio changes, headcounts, capital structure, et cetera, and the impact of those initiatives is translating into our 2021 results. In terms of market conditions, we saw gains in demand that resulted in higher volumes, prices, and margins in Q1 versus Q4. Those market conditions are continuing into the early part of Q2. Demand is good, the supply chain is inventory constrained. If we look at the industry data that is compiled by MSCI, it shows service center inventories are at their lowest levels in many, many years. At the same time, demand is improving. The result is that the number of months of supply across the industry is 30%- 40% below normal levels. The bottom line is that the fundamentals for supply and demand are continuing to be strong, therefore, we are very optimistic on the business outlook. In terms of the OCTG line pipe changes, we set a target to reduce inventories by CAD 100 million by the end of 2021. We accomplished our goal early, and there is more on the come. In Canada, we recently announced a transaction with Marubeni-Itochu to combine our Canadian OCTG line pipe business with theirs. The transaction will create a larger and better-positioned platform, but we also structured the deal in a way that allows Russel Metals to repatriate a sizable amount of our invested capital. To be more specific, we currently have invested capital of around CAD 170 million in that business, and the transaction will result in around 80% of it being realized in cash in the near term. In addition, we'll have a carried interest in the form of CAD 32 million of preferred shares that will have an attractive 7% dividend yield. We expect that transaction to close Q2 or early Q3. On the U.S. side, OCTG, we've made good progress with our orderly liquidation of the inventory in this business. There's around CAD 40 million remaining, and this should be substantially sold by the end of the year. If you take all these initiatives and aggregate them together in terms of what we've been doing on the OCTG and line pipe front, when we are done, we'll repatriate around CAD 250 million of capital that has been tied up in that business segment. The exiting of that segment will reduce our business volatility, enhance our margins, and most importantly, improve our returns on capital at every stage of the cycle. Liquidity and capital structure improvements. With CAD 96 million of cash from operating activities in Q1 and liquidity of CAD 440 million, we are in really good shape from a capital structure perspective. If you go to page six, I'll give you some highlights of our financial results. Starting at the top of the page, from an income statement perspective, the change in results between Q4 2020 and Q1 2021 involved improvement across all of our segments. Revenues of CAD 885 million was the highest level since before the pandemic. Gross margins, EBITDA, bottom line all improved dramatically. Some of our Q1 income statement results were higher than what we generated in all of 2020. As a positive to EBITDA, wage subsidies were CAD 3 million in the quarter, but that was down from CAD 8 million in Q4. As we've said in the past, this program worked well, has provided nice cushion and a transition as business conditions recovered, and it supported employment base during that transitionary period. We don't expect to realize any material benefits going forward. As a negative to EBITDA, stock-based compensation had a mark-to-market impact of around CAD 2 million in Q1 due to the increase in our share price. Financing expense was down noticeably from last quarter. This is primarily a result of last year's refinancing initiatives that were done late in Q3 and early in Q4 last year. From a cash flow perspective, we used about CAD 17 million due to an increase in working capital. The key was that the increase in accounts receivable from improved business conditions was mostly offset by a corresponding increase in accounts payable. Inventory only went up by a small amount, around CAD 11 million, and this is a result of an increase in the service center and steel distributors inventory being mostly offset by our initiatives to reduce the energy inventories. CapEx at CAD 6 million continues to be modest and below our DD&A level. We see this CAD 6 million-ish type level continuing over the balance of 2021. From a balance sheet perspective, our net debt declined from CAD 267 million at the end of Q4 to CAD 202 million at the end of Q1, or a CAD 65 million reduction. Our liquidity is well north of CAD 400 million. Our credit metrics are very strong. Lastly, we have declared a quarterly dividend of CAD 0.38 per share for the quarter. If you go to page seven, I've included some segmented P&L information. The service centers did exceptionally well as the market improved. Revenues were up 40% versus Q4, and this is a function of both higher volume and higher pricing. Our volumes are now above pre-pandemic levels. As we have discussed in the past, our business model is transactional in nature, as we don't tie ourselves into contracts with our customers. This gives us a lot of operational flexibility to quickly adapt to market conditions. That flexibility allows us to pass steel price increases into the markets. The margin dollars per ton improved in Q1 and is maintaining into Q2 as we continue to pass those steel price increases into our markets. One of the keys is that from an end market perspective, the improvements are really broad-based across regions, across end customers. In energy, revenues, margins, operating profits improved versus Q4. Both field stores and OCTG/line pipe generated positive EBIT contributions. We are seeing some improved tone to the energy market, and notwithstanding the seasonal issues that typically occur in Q2 for spring breakup, we expect continued improvement in the back half of 2021. Distributors. Distributors had a really good Q1, as it also piggybacked on the steel market strengths. This was mostly driven by our U.S. business, which is more transactional in nature, whereas our Canadian business is more of a back-to-back business. Looking forward, the backlog for that back-to-back business remains good through Q2. On page eight, we've our segmented inventory information to provide a frame of reference for capital reallocation changes over the past number of quarters. If you look at the metal service center part of it to start with, inventories and dollars have ticked up, but our tonnage remains low. This goes to my earlier comments about the MSCI data that showed limited inventory in the supply chain. Our inventory turns are always pretty strong and have improved as sales picked up, and our strict inventory discipline remains a key ongoing focus. We don't speculate on inventory. In distributors, it's a parallel situation with service centers in that inventory is low. The lead time for procurement is extended beyond normal, especially as logistic issues through the supply chain remain in place. Our procurement commitments that are back to back with custom orders have picked up in the last few months, and we expect this to translate into business activity in Q2 and Q3. In energy, this is a key area. We are well on our way to transforming this part of our business. In the past few quarters, we've benefited from improved market conditions and our tight procurement controls. As a result, we reduced inventories from around CAD 470 million at the middle part of 2020 to CAD 317 million at the end of this last quarter. This CAD 153 million reduction in inventories includes the CAD 99 million permanent reduction in OCTG line pipe that I mentioned earlier. We've also illustrated this chart, the impact of removing the additional inventory in OCTG line pipe from the Marubeni-Itochu transaction that we announced a few weeks ago. Not only have we reduced our energy exposure as a percentage of the portfolio from over 50% to around a third, but the remaining capital in the energy business will be concentrated in our field store segment, which has very attractive long-term fundamentals. If you go to page nine, we've modified a chart that we have used in the past to show our return on capital over a cycle. We have industry-leading returns, and we're constantly looking at opportunities to enhance our return profile. As a reminder, this metric is the driver to our variable compensation model, so everybody across the organization is very focused on it. The green bars show our historical returns year-over-year, including very strong Q1 results. If you look on the right-hand side of the page, over the past 5+ years, we generated an average RONA of around 15%. However, that average has been dragged down by the OCTG line pipe segments, which historically had an average RONA in the low to mid-single digits and therefore brought down the weighted average return on our portfolio. The downsizing of the OCTG/line pipe business that is well underway would have resulted in a pickup of additional RONA, as illustrated by that gray bar, of around 300 basis points on average. As we've said in the past, our initiative to downsize OCTG/line pipe will reduce revenues, but it will be accretive to earnings and accretive to our returns. In closing, on behalf of John and the other members of the management team, I'd really like to express our appreciation to everyone within the Russel family for their tremendous hard work. It's really nice to see the fruits of that hard work starting to pay off. Operator, that concludes my introductory remarks. We can now open the line for any questions. Certainly, sir. Ladies and gentlemen, if you do have a question, please press star followed by one on your touchtone phone. You will then hear a three-tone prompt acknowledging your request. If you should wish to withdraw your question, simply press star followed by two. If you are using a speakerphone, we do ask that you please lift the handset before pressing any keys. Please go ahead and press star one now, if you have any questions. Your first question will be from Frederic Bastien at Raymond James. Please go ahead. Hi. Good morning. Hope all is well with you guys. Hey, Fred. First question is, we keep hearing that product availability is tight. The question I have for you is, are you also feeling that pain or are you managing? Fred, it is definitely restricted. If you look at product availability, mill lead times are into the third quarter now. Some products are well into the fourth quarter. We're managing that fairly well as we've done in the past. The mills are, again, allowing us to have our share that we've requested, that we've bought in the past, and also afforded us the opportunity to grow market share, as you saw with the 4% growth. We're getting what we need in steel. Part of that's due to our scale, part of that's due to Obviously, we pay the mills on time. They've worked very closely with us, and our purchasing teams have done a phenomenal job in projecting out further than typical mill lead times. We're comfortable with what we're getting right now, and we're managing our inventory turns as well as we ever have. I think that's something that is a real credit to our people that are out there and how they're managing the cycle. If we see these conditions continue, I suspect you'll gain even more market share against the small mom-and-pops out there. Is that fair to say? Yeah, there's a real opportunity to do so. I think some of the smaller to medium service centers are probably struggling to get their alignment up to you. I think it affords us the opportunity to continue to grow that share, not only just raw steel products, but we're also seeing strong growth in our value-added processing as well. Okay. Second question, I guess we're well into the second quarter, so I was wondering when these higher input costs will start getting into your service center margins. Are you starting to feel it now, or is this something you won't feel until the summer months, potentially into the third quarter? Yeah. The higher input costs, again, with our turns, obviously, just rationally and logically, it will start to come in sometime during Q2, although we've seen increases this week in every product that we carry. The increases are still continuing to come in. Early in the quarter, we've been able to maintain those margins, in service centers and in steel distributors. Again, there'll obviously be some normalization there as the quarter lingers on into the third quarter. I think we're pretty bullish on Q2 remaining fairly strong there. Okay. Thanks for that, John. I wasn't surprised to see steel distributors capture some healthy spreads during the quarter, but I thought we might see slightly higher volumes. I think, just reading through the slides you presented, the inventory is higher already. Is Q2 shaping up to be a stronger quarter in terms of volume and revenue? There's a couple of dynamics there. One, again, very professional group. Been in the industry 30+ years, they elected early on in the quarter to just pass because they could get a higher price later. That limited some of the volumes. Again, you can see as their margins skyrocketed, gross margin skyrocketed, they were able to take advantage of that situation. Also, we've got some import material that's coming in, into Canada specifically, that's sold back-to-back in Q2 and Q3, as Martin alluded to earlier. We anticipate those volumes to come in and get back out during the month. Again, those are sold primarily back-to-back. Again, as demand in the U.S. is, it's a more transactional market. They'll take advantage of the opportunities as they're presented to them. That's great. Okay, thanks for that color. Good quarter. Thanks, Frederic. Thank you. Next question will be from Michael Dumais at Scotiabank. Please go ahead. Hey, good morning, guys. Hey, Mike. Morning. Hey. I wanted to get maybe at your MSC margins in a different way, or maybe a little bit more specific, just to get a better sense for the potential margin performance in Q2. Can you talk about the delta between the average cost of the inventory versus the selling price and whether that's increased or decreased through Q1? Just trying to get the derivative there. Well, I'm not sure if this is answering your question, but at the end of the day, costs were moving up as steel prices were moving up, but our price realizations were moving up as well. Effectively, margins were moving up in the early part of the quarter and are holding on to that level as we're into Q2, just because price realizations to our customers are continuing to move up. I mean, at the end of the day, the thing to remember is we're a cost-plus business. As we have tight inventory turns, we're turning the inventory pretty quickly, and given the nature of demand right now, it's basically flowing into our end markets. Got you. Okay. Just going back to maybe some of John's earlier comments, I guess Q1 margins were a standout, historically 800 basis points higher, I think, than the previous peak, just trying to get a little bit of a sense for the pace of normalization into Q2, into Q3. I mean, just any comments that could help us out? Yeah. No, you're exactly right. There's obvious holding gains that come into play in that, but I think those are probably too much of the headline. Michael, when we look at it, you've got a group of industry professionals that act on that opportunity in this transactional model that Martin mentioned earlier, where they were able to expand that ability and that margin. Based on what's available in the marketplace out there right now, where some of the smaller service centers are struggling to get material, we have the material. In our breadth of inventory that's out there, we have the ability to continue to maintain that margin, or very similar to it. It may come off slightly in Q2, but I don't see it coming off dramatically. Okay. That's helpful. Thank you. As it relates to potential M&A going forward, how should we think about Russel's appetite for, call it tuck-ins versus platform deals? Specifically on tuck-ins, do you anticipate a pickup in activity as the U.S. government contemplates increased capital gain taxes? The short answer is yes, and yes. We're looking at all the above. As we've always approached it, we're pretty disciplined in what we do, but we have a lot of flexibility to look at stuff small, medium, and large. The issues are, does it meet our criteria from both the financial as well as qualitative operational perspective? I think there's going to be more and more opportunities. We're seeing more and more opportunities that are out there, but the real test is small, medium, and large, does it meet our criteria? We look very actively. In terms of the dynamics in the U.S. right now, again, it wouldn't be surprising with some of the changes that are unfolding, and it's all speculated right now, and who knows what comes into law. With capital gains modifications, that has often, in the past, become a catalyst for people to rethink about what they want to do with their private businesses. We're all ears. If it meets our criteria, terrific. The way we're looking at it right now is we have a lot of flexibility, and if we see the right opportunities, not to be a broken record, but small, medium, or large, we have the opportunity to look at them. Yeah. That's great color, Martin, thanks for that. I guess just a comment on slide nine, that exhibit. It's great. I wonder, Martin, with the OCTG business largely restructured, now Russel resembling metal service center pure-play, which the market is showing that it is willing to pay a higher multiple for, do you anticipate using potentially more equity versus historically when contemplating funding M&A? Well, in some ways, I look at our capital structure right now, which is we've got a boatload of flexibility, and so we don't have to contemplate the use of equity at this point. You never say never to anything, as we're currently structured with both the current flexibility that we have layered on with incremental flexibility, when you talk about page nine, the other piece that's not in the March financials is the capital that'll be coming in once we close the Marubeni-Itochu transaction. We got a lot of financial flexibility right now, and we think we have the ability to look at growth opportunities without incremental equity financing. We're always open to it depending upon the circumstances. Right now, we think we've got a lot of internal bandwidth. Great stuff. Well done, guys. Thanks for answering the questions. Okay. Thanks, Michael. Thank you. Next question will be from Michael Tupholme at TD Securities. Please go ahead. Thanks. Good morning. You touched a little bit on steel availability. I'm wondering if you can talk just in a little bit more detail about what you're seeing right now relative to the way things looked in Q1 just in terms of your ability to source product. Yeah. There's not been a tremendous change since Q1 moved on. January was a little bit more available. It started to really tighten in February and March, and so we're not seeing a whole lot of issues with availability. Again, you have to be able to move with the mill manufacturing cycles and schedules. Our ERP system is set up to do so, and our purchasing team's doing that on a daily basis. We're booking out into the future. Our bookings are a little bit further out than they historically have been, again, as people are moving into Q3 and Q4 with certain products. Again, it's just a function of our ERP system and what our historical purchasing trends have been. John, just to supplement that a little bit. If we look at our inventory in tonnage, as I said in my comments, our inventory tonnage is relatively low, but it's been relatively low for the past four, five, six months. There's not been a massive shift one way or the other in terms of our tonnage during Q1 and even, frankly, a few months before that. Okay. Are there any particular products that you're having difficulty sourcing? As far as difficulty, I would say no. Obviously, in this market, you would take more. The products that are tight right now, flat rolled coil are tight, that are out there, and a little bit of tightness in certain sections of plate. Again, we're getting our allocation of all of that, so we're able to fulfill all of our needs. As Martin mentioned earlier in his comments, it allow us to grow our market share. Cool. That's helpful. Thank you. John, you've obviously lived through many steel price ups and downs over your career. Can you talk about what's different about this cycle? Obviously, appreciate that we're still going through the pandemic, and then obviously that's different. How do you see steel prices evolving over the balance of this year and into next, and what's different about what we're seeing now versus other cycles in the past? The big thing right now, we're seeing the extended lead times, which is typical of a big price run-up that we've seen historically. Again, the supply shortage going into this, and it was spurred by the pandemic that was out there. As you look back from the end user through the distribution channel into the manufacturer of steel, everybody had thinned their inventory. The depth of that went on, has really constrained the supply side, and demand is moving at a much faster pace. There's a lot of availability of cash. People are not going out to the entertainment sector as much as they used to be, the cruises or trips. They're now staying at home, spending that on home gyms or in other areas. We're seeing demand jump back more to the industrial side. If you look across the board at all commodities right now, whether it be wood, steel, everything is moving up in pricing. Again, the backlogs are just tremendous. We look at the architectural billing indexes, you look at the purchasing manager indexes, all those are out as far as we've seen them in a long time. The demand cycle looks extremely strong coming into a thin supply chain, and so we think that's just really expanded this out where it, in our opinion, is going to remain higher for longer on the pricing than we've seen in the past. Okay. You've had several questions about the strength of the gross margins in service centers and talked about how things have evolved so far in the second quarter. In steel distributors, do you expect to see a similar dynamic going forward as you talked about in service centers? Do they continue to hold in through the second quarter the way you've seen on the service center side, or should we be thinking about that segment any differently? That one will probably normalize to some degree. Just in the fact that we've got a lot coming in, as Martin mentioned earlier, in second and third quarter that's sold back to back. That's at a little tighter margin than what we saw in the first quarter. First quarter was really led by our U.S. transaction, and I think they'll continue to do very well, but we'll see an increase in revenue and probably a slight decrease in their gross margins as we go into Q2. Earnings overall should be fine, and the combination of the two should be in the somewhere about area. Okay. I'll turn it over. Thank you. Great. Thanks, Mike. Thank you. Next question will be from Devin Dodge at BMO. Please go ahead. All right. Thanks. Good morning, guys. Hey, Devin. I wanted to say congratulations on the good quarter, I think calling it a good quarter probably undersells what you guys just delivered. Congrats anyway. Thank you. Can you walk us through maybe how demand is trending across your regions and end markets? Just wondering what markets are maybe further ahead in that recovery and where others may still be at an earlier stage. Devin, we're really seeing general economies across the board. GDP is really strong in both Canada and the U.S. Construction economy remains robust right now, which we participate in very well. Equipment manufacturing out there, general OEMs that are out there are all very busy right now. Energy is improving. It still has some room to go, obviously, but we're seeing good signs of energy for the back half. If you're running at CAD 60-CAD 75 WTI on the oil price, that's going to generate some drilling activity. We're pretty bullish on the back half of 2021 and into 2022 on the energy sector. It's definitely lagging in the other sectors that are out there. Automotive is under some pressure. They had 17.5 million units, I think, last month. This chip thing continues to linger on, and we're seeing more and more shutdowns. We don't participate in automotive, but that may create some supply availability in an area that's been very constrained. I don't think it affects pricing. I think it'll just help with availability, maybe bring lead times back to a more palatable level from the manufacturer side. Overall, it's really firing on all cylinders right now. We're seeing across the board is we're seeing a general pickup. Okay. Good to hear. Maybe a question for Martin. Obviously, lots of moving parts in the energy products division. Just when we think about 2022, it's largely going to be an oilfield store business. Can you give us a sense as to what maybe what the gross margins of that oilfield business generated pre-pandemic and where they are currently? It's interesting, Devin, because if I showed you two graphs historically, one of our field store business and one of our service center business, and I didn't tell you which is which, you probably couldn't tell the difference. They followed very similar paths historically, followed very similar paths in terms of gross margins, relatively low volatility and gross margins as well. If you're talking about stuff in that kind of 20% to 21% to 22% range in terms of gross margins, that's what we've typically seen out of our field store business. It does move up and down a little bit like all components, but it has a very similar margin profile to our service center business historically. Okay. Is there much of a difference between the U.S. and the Canadian operations for the field stores? Not really, no. Okay. Devin- Sorry. I was about to say, our field source business is much more skewed to Canada. If you look across some of the numbers, 80% of our business activity is on the Canadian side of the border within field stores. Just to add on to Martin, when you think about that margin profile, a little less volatile in the field stores because the part's such a highly engineered part. There's just not a lot of material in it as a percentage of the finished components. Okay. That's a good color. I appreciate it, guys. I'll turn it over. Great. Thanks, Devin. Thank you. Next question will be from Anoop Prihar at Stifel GMP. Please go ahead. Good morning, guys. Just a quick question, John. We've talked quite a bit on the call so far about inventory availability. Kind of looking at it from the other side of it, which is that we're hitting all-time high levels for pricing on a bunch of different products. I'm curious to know, inventory is tight, but given what pricing is doing, how eager are you to actually continue to add to that inventory? Yes. We're really not speculating. As Martin talked, our tonnage is not moving up a lot. Just a few percentage points that you saw are a gain there in market share. Our turns going at the end of March, were much better than we had for the quarter. Again, we're maintaining that turn level at a very high level. We're not taking an appetite to speculate. Historically, when you've looked at some of our challenges, when there's been a big downturn, it's typically been the write-offs have been in line pipe and OCTG, which we're addressing. It's also, you've seen some of that in the distribution business, particularly in the U.S., where we've taken some of those hits and in the inventory write-downs. Again, they've not grown their inventory. They're just maximizing their margin right now. We're taking a very conservative approach to this, just based on what you've said, and that we are trending at all-time highs. We'll continue to, firstly, run our business on a day-to-day basis, but we're not taking an expected or an aggressive stance on inventory. Okay. All right. That's helpful. Thank you. Martin, just a quick question for you. For the balance of the year, can you give us a bit of color as to how we should be adjusting our outlook for the energy business, given that we are in the process of winding down a substantial piece of that? Yeah. I would say for purposes of Q2, there's always a seasonal dynamic associated with that, so that's just going to run its normal course. If you basically model in a closing at the end of Q2, beginning of Q3, effectively all that stuff comes off the balance sheet and out of the income statement starting in Q3, if you use that timeline. The accounting for our equity interest in the joint venture will be a one-line item that comes over on the income statement and a one-line item that comes over on the balance sheet. It's going to be fully deconsolidated, what was the legacy Triumph business. Okay. Thank you. Great. Thank you. Thank you. Once again, as a reminder, ladies and gentlemen, if you do have any questions, please press star followed by one on your touch-tone phone. Your next question will be a follow-up from Frederic Bastien at Raymond James. Please go ahead. I don't think I've seen a normal year for the steel sector in some time. I'm not sure about you, John, but you've been at this longer than I have. Assuming we get a steady mid-cycle year in 2022, and that's a big if, what sort of earnings potential could Russel be looking at? Well, Frederic, I think you're right. I think this is the second time I've been referenced to experienced or old on this call, I'll take that as a positive. In 32 years, I've not seen what I would consider a normal cycle for a year, it's difficult to project that. What's the price of steel going to be? What's our gross margin going to be in that timeline? Again, not to be evasive for you, but it's just so difficult to project what normal is. Again, as the swings have gotten more compressed over the last few years. The biggest thing I think we focus on is just managing the return at a superior level at both the downside and the upside of the cycle, and our transactional model allows us to do that. We'll continue to focus on that. Again, I hate to be evasive, not be able to give you a specific or a number, but again, it would be a wild guess at this point. Okay. Maybe I'll ask differently. Historically, if you look at over a five, six-year period, you've managed to keep the dividend. You historically targeted a payout of about 80% on EPS for your dividend, and that's been maintained over the last five, six years. Do you feel that on a go-forward basis, you're going to grow into that dividend and we'll see this payout of EPS going down from 80% to 70% to 60%? Is the plan I don't know. Just curious what the plans are there. We'll continue to watch it over the cycle, and we've always tried to hit 80% over the cycle. Sometimes we're over 100%, sometimes we're around 50%s and 60%s, but we'll continue to watch it on a quarterly basis with our board. I would say that theoretically, we will continue to look at that 80% over the cycle. I don't see any big changes there. Okay. Thank you. Thanks, Fred. Thank you. Next is a follow-up from Michael Tupholme at TD Securities. Please go ahead. Thank you. Just a question about thoughts and expectations for changes in non-cash working capital over the remainder of the year. If we maybe set aside the Marubeni-Itochu transaction, I think Martin, you said there's probably another CAD 40 million reduction in inventory to go in energy. If you can just clarify that, and is that all coming sort of over the next quarter or so? How do we think about changes in non-cash working capital stemming from the rest of the business over the year? Your CAD 40 million assumption on the OCTG line pipe, that's correct. That makes reference to our U.S. OCTG line pipe business and we'll substantially get through that in Q3 and Q4, so we should get there by the end of the year. For the rest of the business, to be honest with you, it's going to be really a function of market conditions. If we look back over the last year and the changes that have happened in working capital inventories within our service center business, we adapt really, really quickly. It goes back to the same old theme about inventory turns, disciplined approach to inventory management. It's a key metric for us, and it's what all of our folks right down to the ground level focus on. If we continue to have robust pricing and pricing is continuing to go up, our inventory tonnage might not go up. Our inventory dollars might go up proportionally with whatever steel input prices is going up by. Steel input prices continue to go up, but again, as I said earlier, we're keeping our inventory volume relatively controlled. Our inventory turns is a big focus, so I don't see our inventory volumes changing a whole ton. It's really going to be a function of what flows through from steel pricing. Okay, if you're able to disaggregate, what was the impact in service centers in the first quarter, in terms of the portion of the change in non-cash working capital that related to service centers? That was a negative, that was an investment, right? Sorry, in terms of how much inventory changed in the service centers? Yeah, sorry, on the inventory side in service centers, because I know when you look at the cash flow, there's a few things going on with the reduction in inventories and energy. If we focus on service centers, what happened with inventory? Oh, yeah. In that area? Yeah. It went up by about CAD 50 million or CAD 60 million. Energy came down by about a similar amount. Okay. Just one other question on a different matter. You were asked earlier about M&A. I'm just wondering, in this environment, the steel price environment we're in right now, which is obviously unprecedented, is this an easier or harder environment to contemplate and consider M&A? If we put aside the potential tax changes, that's a separate issue, but just in terms of when you're assessing businesses in this environment, is this an easier time or a harder time for you? I wouldn't characterize now as easier or harder because it's always hard. I mean, the hit ratio on stuff that we see and we look at versus stuff that we transact on, it's not a great batting average. That's just the nature of the beast. We don't chase stuff for the sake of chasing it. Just because stuff becomes available doesn't mean we do it. Sometimes there's stuff that's available at a pretty cheap price. Yet sometimes a cheap price is too expensive if it's a massive turnaround situation. I think it's always hard. That being said, it's nicer to see more activity because there's more stuff to choose from. We tend to have a pretty low batting average because we're very, very selective of what works for us. Okay. That's helpful. Thank you. Great. Thanks. Thank you. At this time, gentlemen, we have no further questions. Please proceed. Great. Well, thanks, operator. Well, look, thank you very much for joining the call. We appreciate you focusing on the quarter. If you have any questions, please feel free to reach out anytime this afternoon or going forward during the quarter. We look forward to staying in touch and reconnecting at the end of Q2. Thanks very much. Thank you, sir. Ladies and gentlemen, this does indeed conclude your conference call for today. Once again, thank you for attending, and at this time, we do ask that you please disconnect your lines.