Thank you, Karen. Good morning, everyone.

I'm Alexandra Deignan, the company's Vice President of Investor Relations. Welcome to Schnitzer Steel's First Quarter 2015 Earnings presentation.

Thank you for joining us today. In addition to today's audio comments, we've prepared a set of slides that you can access on our website at www.schnitzersteel.com or www.schn.com.

Before we get started, let me call your attention to the detailed Safe Harbor statements on Slide 2, which are also included in our press release of today and in the company's Form 10-Q, which will be filed later today.

These statements, in summary, say that in spite of management's good faith, current opinions on various forward-looking matters, circumstances can change, and not everything we think will happen always happens. Please note that we will be discussing some non-GAAP measures during our presentation today.

We've included a reconciliation of those metrics to GAAP in the Appendix to our slide presentation.

Now let me turn the call over to Tamara Lundgren, our Chief Executive Officer. She will host the call today with Richard Peach, our Chief Financial Officer.

Thanks, Ally. Good morning, everyone, and Happy New Year, and welcome to our fiscal 2015 first quarter call.

On our call today, we will take you through a review of our financial results. I'll begin with some highlights and provide a perspective on market trends.

I'll also discuss the new cost reduction and productivity initiatives in our Auto Parts Business that we announced this morning. Richard will then share with you further details on our segment operating performance and our capital structure.

After that we'll open up the call for questions.

Let's turn to Slide 4 to get started. This morning, we announced adjusted earnings per share from continuing operations of $0.08 for our first quarter.

These results reflected improved performance in both our Metals Recycling and Steel Manufacturing businesses as compared to Q1 of fiscal '14.

Before we go through the details, however, I think that it might be helpful to provide a bit of perspective on the quarter. Between September and November of this past year, ferrous export selling prices declined approximately $80 per ton or 20%.

And ferrous domestic prices declined approximately $60 per ton or 15%. The market had not experienced this steep of a decline, since 2012.

Three of our business segments generated positive operating income, largely due to benefits from their productivity initiatives. Our Metals Recycling and Auto Parts businesses were both significantly impacted by the decline in ferrous selling prices.

This resulted in an adverse impact from average inventory accounting, which was estimated to be approximately $0.23 per share, and which offset the benefits of productivity improvements and cost savings.

In our Steel Manufacturing Business, we continue to benefit from strong demand in the West Coast construction markets. SMB more than tripled its first quarter operating income versus last year.

We are continuing to take steps to improve business efficiency and reduce our cost base across our organization. We delivered ahead of schedule on our previously announced savings initiatives in our Metals Recycling Business.

And we have identified further savings in our Auto Parts Business, which should lead to improved financial and operating performance.

We now anticipate annual benefits of $14 million in ATB, which is up from the $7 million, we previously announced. We believe these actions will continue to enhance our performance and should provide greater opportunity for margin expansion.

So now let's turn to Slide 5 for more detailed look into the ferrous pricing trends. This slide sets forth the publicly reported general market selling prices for ferrous scrap.

As you can see, ferrous scrap prices remained fairly steady through the summer, which coincided with our fiscal year end. From September through November, however, average ferrous export selling prices declined approximately 20%, as global demand weakened, largely driven by the high-volumes of low-priced steel exports from China; sluggish global growth and a stronger U.S.

dollar. Domestic selling prices were influenced by the softer export prices and declined approximately 15% during our first quarter, but maintained a premium over export prices due to stronger economic conditions in the U.S.

If we turn to Slide 6, we can review U.S. ferrous export volumes.

Looking at the left bar chart on this slide, you can see total U.S. ferrous exports declined 16% during the last 12 months, which was more than the decline in our own export volumes.

Over the last 12 months, our total sales volumes dropped by just 6%, as we offset the decline in export sales, with an increase in our domestic sales. In the last 12 months, our domestic shipments represented 33% of our total shipments, our highest level since 2008.

So let's turn now to Slide 7 for a review of our quarterly sales activity. As you can see on the left bar chart, during our first quarter, stronger domestic demand also offset weaker export demand.

In the central pie chart, you can see the balanced distribution of our sales volumes among Asia, the Mediterranean and the domestic U.S. Including ferrous and nonferrous products, we shipped to 16 countries this quarter.

Our top ferrous export destinations were Turkey, Egypt and Thailand. Our top nonferrous destinations were the U.S., China and South Korea.

The right-hand bar chart shows that our nonferrous volumes in Q1 were up year-over-year by 3%, reflecting higher nonferrous extraction yields and timing of shipments.

So now let's turn to Slide 8, and I'll review the highlights of our progress, on our productivity and cost-reduction initiatives. In fiscal '14, you'll recall that we announced a $40 million productivity and cost savings initiative, which was primarily focused on MRB and was scheduled to be achieved by the end of fiscal '15.

We have delivered on our target ahead of schedule, as you can see on the graph, we maintained a quarterly run rate of $10 million in benefits in the first quarter of 2015.

Last quarter, we announced a productivity initiative in our Auto Parts Business that was targeted to achieve annual savings of $7 million. Today, we are announcing an increase to this target of an additional $7 million for a total annual benefit of $14 million.

The completion of these initiatives is expected to yield higher earnings and increased efficiencies by centralizing and streamlining build-support activities, reducing organizational layers and achieving cost reductions.

The initiatives announced, today, are expected to reduce annual SG&A cost by $7 million. We anticipate a workforce reduction of approximately 4% of APB's headcount, and a restructuring charge of approximately $2 million.

We expect to realize 50% of the annualized $14 million of savings by the end of fiscal '15, and full realization of annualized savings during fiscal '16.

So now let me turn it over to Richard for an update on our operating segment performance and our capital structure.

Thank you, Tamara. I'll begin with a review of MRB's performance on Slide 9.

Ferrous sales volumes of 938,000 tons were slightly down year-over-year, and 14% less from the fourth quarter of fiscal '14. The sequential decrease was driven by the weaker export demand and the impact of the lower price environment on scrap supply.

Compared to last year, exports were down by 8%, with total sales volumes only down by 4% due to a higher proportion of domestic sales. Although, the high to low on ferrous selling prices fell by $80, the average net selling price in the first quarter of $328 per ton was only down by $23 per ton, sequentially.

Our ferrous revenues are recognized on a shipped basis. So our first quarter average net selling price, includes the beneficial impacts of selling some cargoes at the higher prices, which we saw in August and September.

Generally, we are making sales for shipment 4 to 6 weeks after the order date.

Nonferrous sales volumes of 127 million pounds were up 3% from the prior year quarter, but down by 18%, sequentially, mainly due to the adverse impact on production of lower ferrous volumes. The average net selling price for nonferrous was in line, sequentially, but down by 4% year-over-year, consistent with the general drop in commodity markets.

MRB's adjusted operating income in the first quarter was $8 million or $8 per ton. These results represented an improvement on last year's first quarter, mainly due to the continued implementation of MRB's productivity improvements, which totaled $7 million in the quarter.

The adjusted results exclude the adverse impact of $6 million arising from the resale or modification of certain previously contracted ferrous bulk shipment for delivery in the first quarter.

The last time this happened was back in 2008, when the market collapsed. So the non-GAAP adjustment within our results is intended to provide comparability, with other reporting periods and to do more insight to our overall performance in the quarter.

On a sequential basis, the substantial drop in ferrous markets, also led to a significant impact from average inventory accounting. Even though, we reduced our purchase prices for raw materials, both reported and adjusted results, includes an estimated $7 million adverse impact of average inventory accounting, which was the main reason that our adjusted results were different from our fourth quarter.

It is important to note that because we have a high focus on managing our inventory returns and/or buy program to quickly adjust to market changes, we did not incur a significant inventory evaluation charge, despite the large market drop.

The productivity benefits in MRB's results are arising from a combination of a 12% year-over-year reduction in the MRB's headcount, the elimination of management layers, increased use of shared services, cutting transportation costs and more efficient yard processes, which has reduced both over time and use of outside contractors.

The improvements are split between cost of goods sold and MRB's SG&A, which in fiscal '14 was down by 10% from the previous fiscal year. MRB's productivity contribution was the majority of the $10 million consolidated total for the quarter, with the remaining $3 million for the total, split between our other 2 business segments and corporates.

Now moving to Slide 10. Let's turn to our Steel Manufacturing Business.

SMB continue to deliver higher performance year-over-year on improving demands in the West Coast construction markets, which drove 4% higher average selling prices and continued contributions from productivity initiatives.

Operating income of $6 million was $4 million higher year-over-year, due to improved gross margins driven by the strengthened demand. And a bad debt of $1 million in the last year's results.

Sales volumes of 127,000 tons were in line with the prior year first quarter, but lower sequentially due to our planned maintenance outage. Rolling Mill utilization in the quarter was 72%, up significantly from 65% in the prior year quarter.

Now let's move to our Auto Parts Business on Slide 11. Auto Parts continue to generate strong car purchase volumes in Q1 of 97,000, up 7% year-over-year, on benefits from ramping up new stores and organic improvements.

However, the sharply lower commodity prices had a significant impact on the first quarter results.

Operating income was $2 million compared to $6 million in the same quarter last year. Of the difference, $2 million was due to the estimated adverse impact of average inventory accounting, with the balance due to further margin compression arising from the lower price environment.

Compared to the fourth quarter, the lower results were due to the average inventory accounting effects, lower commodity prices and a drop in part sales.

As we noted in the fourth quarter of fiscal '14, we announced the major new productivity initiative in APB of $7 million, focused on increasing our operating efficiency and improving our car yields.

Since then, we've identified additional savings of $7 million, focused on reducing SG&A, where we're aiming to achieve part-year savings of more than half and the remainder of this fiscal year. Of the SG&A savings amount, around 2/3 will come from headcount reductions with the balance from non-car procurement areas including transportation, fuel, supplies and marketing.

Now moving to Slide 12. I'll discuss our capital expenditures and net debt.

Capital expenditures in our first quarter were $10 million, covering mainly maintenance environmental and safety-related projects.

For fiscal '15 as a whole, we expect CapEx to be no higher than fiscal '14, which was $40 million. As of the first quarter, net debt leverage of 50% was approximately 200 basis points lower than the prior year first quarter, due to strong working capital management and cash flow generation during fiscal '14.

In the first quarter of fiscal '15, operating cash flow was a modest use of funds of $60 million, due to timing of working capital movements.

Now I'd like to turn the presentation back over to Tamara for her summary remarks.

Thank you, Richard. While challenging market conditions prevailed during our first quarter, we continued to deliver on our goals.

We completed our targeted savings initiatives ahead of schedule. We generated improved results year-over-year through productivity improvements.

We maintain the strong balance sheet and we returned capital to our shareholders through our quarterly dividend.

Our Metals Recycling Business adjusted rapidly to changing market demand, whether export or domestic, while offsetting price and volume headwinds with productivity initiatives and a restructured cost base.

Our Steel Manufacturing Business generated substantially higher year-over-year quarterly performance due to higher selling prices, increased rolling mill utilization and contribution from productivity improvements.

As we look ahead, we are continuing to take steps to improve business efficiency and restructure our cost base across our organization. In our Auto Parts Business, we have identified further savings initiatives, and these actions are expected to yield improved performance.

In our Metals Recycling Business, we are taking steps to further reduce variable production costs in order to mitigate the current impact on volumes from the lower price environment.

In our Steel Manufacturing Business, we expect to further optimize our performance, with higher utilization levels from improving U.S. nonresidential construction activity.

Market conditions are expected to remain challenging in fiscal '15. Our diligent focus on capital spending and maintaining a strong balance sheet will continue to provide a strong foundation for our shareholders, generating greater returns from our business and consistent capital returns to our shareholders through our quarterly dividend.

Once again, thank you to everyone on the Schnitzer team for your continued focus on operational excellence, and for making our company a safe and productive place to work, each and every day.

Operator, let's open up the call for questions.

Okay. I just want to take a step back and talk about the export market a little bit.

And that's always been Schnitzer's bread and butter, in terms of the primary business of exporting scrap. And shifting this quickly back to the domestic market has been a great way to hold on to volumes and I get it.

But I'm just wondering, what does this mean for the company's business model? Is this something you can continue to do?

How much more? Given the strong dollar and the competitiveness of iron ore, I'm just wondering, how you envision your business model going forward in terms of export versus domestic sales of scrap?

Well, I think the core fundamental of the business and the sector, in general, is that it's a spread business. So export demand exists, the level of demand and price is what changes from time to time.

And we're a spread business. And so, we adjust prices for demand in connection with currency movements, and in connection with volumes.

And that's what enables us to maintain positive cash metal spreads. So I think that what we've shown over the last year is a flexibility to adjust the model to serve domestic demand.

And as the U.S. economy continues to strengthen, and you look at things like our Steel Manufacturing Business, where utilization is 72%, right now, so there is a fair amount of runway left going into a continued strengthening nonres market.

And also a market that may be responsive to infrastructure investment, which looks to be a best idea in Congress on the part of both parties and the President. I think that you should anticipate that we've got the opportunity to continue to increase the proportion of domestic sales.

Okay. That's helpful.

But I guess, I was just trying to make sure I understand it. Is it possible that -- since from the past has avoided the domestic market, and clearly the tables have turned in a couple of ways.

So is it possible to see similar margins in the domestic market or attractive enough margins to make that switch.

Well, I guess, what I -- the way I responded that to me is -- I wouldn't say that we avoided the domestic market. When we were selling -- when we sell where demand is strongest and prices are most beneficial.

And so, right now, the domestic market has a premium to export. And so we're optimizing and maximizing domestic demand, as a result of that.

So that's how I'd look at it as opposed to an avoidance. It is -- we shipped to where demand is greatest and where we can make the most money.

Okay. I ask one more, if I could and then get back in the queue.

But on the MRB side than on exports, I asked some Chinese on mill recently, how their scrap makes us looking and they laughed at me. They just said, we're not using scrap as much at all.

Given where iron ore is and given that Chinese billet can be used in Turkey in lieu of scrap, just wondering, what are your customers saying about why they're still using scrap to the extent they are? Is there a need for it?

Can they get by without it or is there a minimum level that they're still buying from you? Are you selling to blast furnaces, at all?

Or is it now just more electric arc furnaces?

Well, as you know, blast furnaces can use up to 20% scrap. And many of them arbitrage where prices are -- where cost is most effective and yield is most effective, and is driven by products that they're making.

But our customers are buying scrap. And -- an EAF will use the scrap or to the extent billets from time-to-time.

But we're not, I mean, we are selling scrap very consistently into EAFs and into new markets, as well as we expand our customer base.

I want to understand this adjustment you've done for $6 million. Can you just explain to us, again, what was it?

Sure.

Yes, Sal, it's Richard here. What happened here is that the rapid drop in market prices has coincided with a couple of customers, not honoring their commitments for certain bulk ferrous shipments, where we've entered in to contracts with them, As a consequence, we had to resale or reprice these cargoes at a lower selling price.

So the non-GAAP adjustment reflects the difference between the original price and the revised price. Because the last time this happened was actually as far back as 2008, when the market collapsed.

We've made a non-GAAP adjustment to provide comparability with other reporting periods and to give more insight to our results and our overall performance in the quarter.

What you're saying is that, you had booked this at a different level -- at a different price and then you finally shipped it at a lesser amount?

We had expected it, the original contracted amount. And eventually, we had to book it in a reported result at the revised lower amount.

So we've made a non-GAAP adjustment for the difference, so that we can provide more of an insight to our overall results.

So your fourth quarter results of $16 per ton operating income, I forget what the number was $15, did not have that -- what I mean to say, should we correspondingly -- to reduce your fourth quarter '14 number by that amount because you had already...

No, no, no. These were contracts for shipment during the first quarter.

And we actually did still ship the tons during the fourth quarter -- during the first quarter, rather. So that both the original contract and the revised contract were within the first quarter.

So there's no impact on fourth quarter numbers.

Yes, because I'm a little confused that -- you expect it to sell at certain price -- sell it at a lesser price, why would we adjust it, I just don't understand that...

Well, it's because, we're adjusting it to provide comparability with previous reporting periods because, as I said, the last time this happened was is far back as 2008, which was a very long time ago. So it's really an adjustment for comparability and to provide insight to our overall performance in terms of our expected and actual revenue trends.

So we should not really add it back to your EPS number, should we? Because this was just an expectation versus what is realized?

We have added that back to our EPS number, because remember, remember we buy behind these sales. So we had an expectation of a level of profitability on those sales that was built into our own expectations for our performance for the quarter that did not happen.

So we're showing our results both on the reported and the adjusted results, because remember, these are actual sales contracts. And so it wasn't and purely our own internal expectations, the customers did not honor and the commitments that were within these contracts.

First question I had -- was on APB margins. Just trying to get a sense, maybe -- if you add back the average inventory impact for the quarter, you still have a pretty -- a sequentially weaker margin in that business.

And I was just hoping, you can give us some more color on what's going on there? Is that more of a commodity price -- product commodity prices have come down, nonferrous prices have come down.

So you're sort of extracting less value from the -- from what you're processing there or is -- or parts? Or is it a more function of competitive dynamics getting the cars?

There are 2 issues going on there, Luke. And you pointed on both of them.

You are correct that, sequentially, our operating income did reduce. It was $5 million in Q4, and it was $2 million in Q1 for Auto Parts.

All that difference, $2 million is the adverse impact of average inventory accounting, because the market was falling so quickly, we were reducing our purchase costs for cars. But the average inventory cost that was entered or cost of goods sold lagged behind the reduction in cash, purchase prices, but $2 million of it.

The remainder of it is compression in cash metal spreads, as a consequence of the lower ferrous and nonferrous prices in the first quarter. So these are really the 2 reasons, why the first quarter results are different from the fourth quarter results.

Okay. The compression in spread is that more of -- sort of an ongoing competitive dynamic as a...

It's more related to -- it's related to the lower price environment. When prices go down, this low -- it does affect the flow of vehicles.

So even though -- and you can see that compared to the fourth quarter, our car volumes are slightly down compared to the fourth quarter, so that -- the impact of the overall lower price environment on cash spreads due to the flows.

Okay. So it's kind of similar to what happens in MRB where -- when the offer prices come down, less cars come to the market?

Yes, that's correct.

Okay. All right.

And then on CapEx. So $40 million looks like the number for this year.

I guess, what happens at a $40 million CapEx run rate? In terms of is that -- is $40 million just covering the maintenance, not covering the maintenance, does that include a little bit of growth investments in there?

I'm just trying to think about what happens internally at that sort of investment level?

Yes, the $40 million is primarily focused on maintenance CapEx and environmental projects and safety-related projects. And we are satisfied that -- at that level, that includes our critical needs for maintaining our asset base.

There's some small growth projects that are included in there, but the big difference between that level, which was last year's and this year's, and what you've seen in previous years, were the significant shredder activity that new CapEx, new growth projects.

Okay. So we could see, this is a level of CapEx that could be perpetual, if you want it to be?

Yes, yes, ex large growth projects.

Okay. All right.

And then lastly, on just -- on steel, any -- it's little early in the year, but any guess, any insight in terms of backlogs and how this year's construction season might be starting to look?

Well, the order books from our customers look strong. The nonres construction market in the West Coast continues to strengthen.

And the possibility of an infrastructure program looks more and more likely as that's fundamentally on the short list of best ideas for both parties in Congress, in both houses of Congress and the President. So we think that the markets in which we operate on the West Coast for skilled demand, it's quite strong.

Okay. All right.

I'd like to ask one more just on imports, I mean to ask on rebar. You've benefited some from the Mexican case.

I think you said last quarter, maybe some of the other countries are starting to creep in that market though, sort of to take their place. Any color on what's going on with that dynamic would be helpful.

Well, the business on the West Coast as well as nationally, is always going to be impacted by imports. So that you can see in the volumes and also in their productivity, is that the demand is on the West Coast nonres that's offsetting impact from imports that have always existed and will continue to exist.

And the productivity initiatives and the productivity culture that has developed and taken hold in the Steel Manufacturing Business, is really leading to significantly improved performance, as I mentioned, year-over-year their operating income more than tripled.

Richard, do you have an approximate dollar impact related to the outage on the quarter at Cascade?

It was about $1 million.

It's about the same last year, as well?

Yes.

Okay, great. And then, on auto parts, how would you characterize car purchase volumes kind of without the help of these ramping new stores that you talked about?

Well, car purchase volumes have held up very well in the Auto Parts Business, as a consequence of our business model there, our position and our buying practices. So you can see that, the year-over-year, we've got that improvements despite the lower price environment.

And you're correct to point out that the part of it is the ramping up of new stores and the volumes for them, but there's also to a lesser extent some organic improvements in there.

Okay. And then, as far as the cost reduction program, I mean, are you considering potential store closures included within that, or would that be completely separate from what you've announced today?

That would be separate from what we've announced. We obviously look at the efficiency and efficacy of all of our operations on a regular basis, but that -- if that were to happen, that would be separate from what we announced.

Okay. And then just lastly, just given where the -- the stock is today, how does share repurchases kind of fit within the capital allocation strategy right now?

Well, share repurchases and our quarterly dividend are the 2 main ways in which we deliver consistent returns to our shareholders. So we review that on a regular basis.

And we have repurchase authority from the Board.

Questions following on from Timna's question about the -- selling back into the domestic market. Historically speaking, obviously taking out the anomalies, do you make more on the export business in terms of your margins, so if you had to sell more here going forward as a business that was the new lay of the land, because of what's going on in Asia and China, especially.

Would that mean, just the normalized margins would be lower than they had been in the last, say 10 years so to speak?

No, no, I wouldn't think that at all. Again, we're spread business.

The flexibility of our platform allows us to meet demand wherever it is greatest. So we pursue all markets aggressively, and direct our product to where it benefits the bottom line most effectively.

And so that means, we look for and add new customers to the export market. We add new customers to the domestic market and that's true for both ferrous and nonferrous products.

But if still here -- but if you're buying here and then selling back in to here, it's just not -- the spread is still similar to what -- I'm not -- the spread I'm not saying similar to what export is, but you still can make as much as you did when export was booming to Asia and things like that?

At the end of the day, it all depends upon where prices are -- where selling prices are? How robust the U.S.

economy is in terms of generating scarp, because remember, scrap can't just be mined. It is - its existence is driven through consumer demand and industrial production.

So it's a combination of factors that drive metal spreads at any point in time.

Okay. And then follow-up question on the steel business.

We've seen hot rolled prices go down significantly, rebar really hasn't moved much. So the West Coast in terms of prices, have prices held up?

Demand is from -- and have prices held up, or are you seeing any pressure on prices out there?

[Audio Gap]

Our next question comes from the line of Phil Gibbs.

Strong execution in very tough environment. Question just on thoughts about rationalizing your export footprint to the extent that the demand environment stays weak for exports.

I know that SIMS has got some, some aggressive new management in place and maybe you've taken some of their projects off the drawing board or scrutinize them a little bit more about adding capacity, just to where that might fit in your thought process moving forward?

I'm not sure, I followed your question. What ...

what are you asking?

I'm asking about the potential for some of your facilities on the export side to be rationalized, given the fact that export demand is tepid, and also in light of the fact that I think SIMS has more aggressive management in place now, and they might not be as aggressive in looking to expand their business domestically?

So, so we review the effectiveness, efficiency and metrics of our projects, of our facilities on a very regular basis, and that is what has driven. The productivity initiatives and the guys are disciplined, cost reduction moves that we've made over the last couple of years, because we want to maintain the position of being the low-cost producer in all of the regions in which we operate.

And so we have been quite discipline focused and aggressive, and making sure that we can effectively adjust our variable production costs and our metal margins in this business. So we don't have plans to take out capacity.

We have done a lot of work in restructuring our cost base. And our focus has been on reducing fixed cost, adjusting resource levels and shift schedules to match volumes.

We have done portfolio optimization by adjusting asset and equipment utilization. And we put a big focus on those assets that we believe can improve their performance.

So we're not looking to take any of our major facilities offline. We were not in a position where we had shredders competing against each other, nor were we in a position where we were putting in new shredders that were going into markets that had a lot of capacity.

And so, for example, if you look at our Southwest region, we've never put a shredder in there, because we thought that, that region of the country was over served by shredders.

Okay. I appreciate it.

And then, just a couple of follow-ups, if I may. The -- as far as your outlook for networking capital, or inventory levels, moving into your next couple of quarters, because -- and I don't know if your inventory has built this quarter, but certainly your cash went down a bit.

So any color you could provide there?

Yes. Phil, its Richard.

Overall, our inventory levels are low. So we've been -- we've got a strong focus on matching or buying to our selling and not building inventory levels in what is a fairly volatile market.

So we've had very tight, and management of our working capital and our inventory. And in fact, that's one of the reasons why we do not have any inventory charges, despite this -- or any significant inventory charges, despite this very large drop in the market, because we've been managing our inventory terms and their buy program very, very carefully to adjust to the market changes.

After 7 quarters in a row of positive operating cash flow, in the last quarter, you're correct, we did have a modest use of funds of about $16 million. That's mainly just due to the timing of working capital movement.

I think we've shown over time a strong track record of positive operating cash flows in good markets and in tough markets. And I would expect, as we move forward through this fiscal year, that we will have some positive operating cash flow in quarters to come, but we remain very focused on disciplined working capital management.

Okay. And Tamara, was it port congestion issues on the West Coast?

Some of the demurrage that we're reading about. Did that impact you guys in the quarter?

Well, things are moving more slowly on the West Coast. But container shipment of the West Coast as a part of our whole portfolio is really quite small.

So you wouldn't really see it in our results. But things, obviously, are moving more slowly there.

Okay. And then, just last one for Richard.

On the reseller modification of the contract, any insight you could provide us on how much volume was involved in that deal?

Well, the volume -- are still in our results. So we're just really related to a small number of contracts with a couple of customers, but it didn't affect the volumes in the quarter at all, it was really the pricing.

I was just asking about the -- how much of -- I realized that it was within the numbers, just asking how much of the volume was impacted?

It was -- it really was a small number of shipments, less than a handful.

David, sorry about that. We are not sure what happened?

I was just asking about -- demand for nonres and infrastructure seems to be okay. I was just wondering with prices, I know, for hot rolled have fallen, rebar has been more stable a little bit, obviously, it's down from first half of last year.

I was just wondering in terms of pricing, are you seeing any pressure on prices coming into this quarter?

Well, again there's always seasonality, obviously. But generally speaking, our customer order books are strong.

And the macro environment on the West Coast for nonres construction and infrastructure, we see as strong.

You mentioned a capacity utilization increase to the SMB from 65% to 72% year-over-year, but it looks like shipping volumes were flat over that time period. So this would seem to indicate you've reduced your production capacity.

Is that accurate? Or is there something else at play here like a temporary capacity adjustment related to an outage?

No. There's no temporary issue there.

What was happening here, Andrew, is that utilization will -- naturally change from quarter-to-quarter. And even though our volumes were flat compared to last year's Q1, but our utilization was up.

The reason the utilization is up slightly is related to generally stronger order book. So that higher production is, probably, already sold in the month of December.

Okay, understood. And then on a separate topic.

I'm curious if you could comment on the impact of falling oil prices on the scrap market, and specifically on the supply side, as the U.S. rig count declines, would a large-scale decommissioning of oil and gas rigs to add a meaningful quantity of scrap to the overall market?

Or will this most likely not move to needle in terms of scrap availability in the coming quarters and months?

I don't foresee that it's going to change the availability of scrap in the immediate or short term. And obviously, energy prices go through their peaks and troughs as well.

So I wouldn't anticipate that, that's going to affect the supply of scrap material.

I was just thinking about the reason, why maybe I had it stuck in my head that you have avoided the domestic market, and you've made the point that you've been staying away from markets that are overly crowded like in the Southeast. So I guess, I just wondered how you can compete moving more into the domestic market, when your mega shredders are all positioned for the ports.

And so I'm just wondering, is there something I'm missing on that, because the -- is there a transportation advantage maybe you have, or is there something else, because your locations of your mega shredders are not located near very many of the many mills that are larger. So I'm just wondering, if there is a different advantage that maybe I'm missing.

No. I mean, we ship domestic from our East Coast operations and from our West Coast operations.

In the Southeast, we don't have a shredder, Timna, and that was because our view has been that there has been too much product capacity in the Southeast. But we sell domestic from West Coast and East Coast.

And one of the points that I was making before is, obviously, we provide the scrap into our own mini-mill in Oregon and that mini-mill, Cascade -- is operating right now at 72% utilization into what we view as a strengthening market. And so we anticipate that's a -- as that market continues to strengthen, their utilization goes up, the proportion of our domestic sales will go in as well -- will go up as well.

But fundamentally, selling into domestic market is a function of price and logistics. And we've been actually quite effective, for example, on the East Coast, in terms of increasing the amount of material that we're selling domestic.

Well, thank you, very much and thank everyone on the call for joining us today and for your interest in our company. We look forward to speaking with you again in April, when we announce our fiscal 2015 second quarter results.

Thank you very much.