TimkenSteel Corporation (NYSE:TMST) Q4 2022 Earnings Call Transcript

Mike Williams: Well, you have to recall that 70% of our sales is already on contractual commitments for annual pricing, the remaining 3% are negotiated prices either on a quarterly or semi, annual basis. And we just announced two price increases, as Kris mentioned in his comments, one for our tubular products, one for our bar products, we fully expect that to continue into the second-half of the year.

John Franzreb: Okay. And is there ever been a noticeable change in the demand profile at your customer base and any kind of venting concerns about global economic conditions?

Mike Williams: Well, I mean, look, we can with all the things that are going on globally, we’re concerned. However, what our customers are telling us, as they see stable and steady demand, there are pockets of sub-sectors within our market segments that are accelerating their demand, and we’re reacting to that accordingly. So, our lead times are actually out to the end of Q2 and beginning to enter into Q3. So, more to come on that, but with some of the uncertain global uncertainty, some of the domestic uncertainty, we always keep our eye on the ball, and we’ll see how things progress.

Kristopher Westbrooks: The benefit that we have going forward with the footprint that we have today is we’re not out there chasing the type of volume we may have had a couple of years ago. So, it’s that 800,000 to 900,000 ship tons that we’re targeting as we move forward and feel good about the demand in that range as we move forward.

John Franzreb: Great, thanks for taking the questions.

Kristopher Westbrooks: Thanks.

Operator: The next question is from Dave Storms with Stonegate. Your line is open.

Dave Storms: Hey, just a follow-up question on a melt shop utilization and the strong demand that you’re seeing, is there a scenario where you continue using some of that third-party melt shop, just to cater to meet that demand throughout 2023 or is that expected to phase out as you get your own melt shop utilization back up to that 80%, 85% range?

Mike Williams: Yes, that’s part of our strategy. We believe that we can flex with market demand using third-party melt. And as long as there’s profit to be added in it and converting that third-party melted into our finished products, we’re going to pursue that. If there isn’t, we won’t. Does it make sense?

Dave Storms: That’s a perfect answer. Thank you.

Operator: Showing no further questions at this time, and this will conclude today’s conference call. Thank you for participating. You may now disconnect.