Thank you, Abigail. Good morning.

I am Alexandra Deignan, the company's Vice President of Investor Relations.

Welcome to Schnitzer Steel's fourth quarter and fiscal 2016 earnings presentation. In addition to today's audio comments, we have 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-K, which we expect to file 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 our call over to Tamara Lundgren, our Chief Executive Officer. She will host the call today with Richard Peach, our Chief Financial Officer and Chief of Corporate Operations.

Good morning, everyone, and thank you for joining us on our fourth quarter conference call. This morning, we issued our press release, which is posted along with our slides on our website.

On today's call, we'll walk through our fourth quarter performance and market trends, review our fiscal '16 accomplishments and highlight our fiscal '17 priorities. We'll start on Slide 4.

Earlier this morning, we announced our fourth quarter results. We reported GAAP earnings per share of $0.59 and adjusted earnings per share of $0.60, both of which included an insurance reimbursement of $0.21.

Even without that benefit, our fourth quarter results improved versus last year.

We were pleased with our stronger performance, particularly in light of the fact that as compared to last year's fourth quarter, ferrous scrap prices were down 10%, finished steel prices were down 12% and sales volumes continued to be impacted by a weak global economy, excess steel production and strong dollar.

The benefit of our productivity initiatives and sustainable cost savings showed through again as they did in the third quarter. As a result, in addition to significantly improved year-over-year earnings, we were able to deliver another quarter of positive operating cash flow which allowed us to reduce our debt to its lowest level since 2011 and continued to return capital to our shareholders through our quarterly dividend.

However, the fourth quarter was not without its market challenges. So let's turn now to Slide 5 for a review of market trends.

The chart in the upper left-hand corner illustrates the significant volatility in ferrous prices that we experienced over the course of the fiscal year. The year was effectively comprised of 2 very different market environments.

The first half of the fiscal year saw ferrous export prices drop to near-decade lows. During the second half of the fiscal year, that drop reversed, albeit with considerable volatility.

However, during the last 2 months of the fiscal year, prices traded at levels close to where the year had started and in a more normal 5% to 10% trading range.

If we turn our attention to volumes, you can see in the upper right-hand corner of this slide that ferrous export sales volumes also experienced volatility during the course of our fiscal year. From the start of the fiscal year through July, U.S.

ferrous exports dropped by 13% year-over-year. In August, however, we saw a different level of activity as U.S.

exports increased significantly, reaching a 15-month high.

Year-over-year, our own ferrous export sales volumes did not fall as much as the market's. For the full fiscal year, our export volumes decreased by 8% versus the market's full year 10% decline as we focused on broadening and deepening our customer base.

The increased export demand for scrap that we saw in August may signal positive longer-term momentum for the scrap industry. First, we are seeing iron ore trade in the high 50s, reaching $60 per ton during the fourth quarter.

These higher prices are making billets less competitive as an alternative to scrap.

Second, since July, we have seen lower exports by China of both semi-finished and finished steel products. Now some of that may have been influenced by the closure of steel mills in advance of the G20 meeting in September, but we've also seen the planned merger of China's 2 largest steel companies and the continued articulation by the Chinese government of their commitment to reduce overall steel production while increasing the use of scrap.

And lastly, we've seen significant increases in coking coal prices, which, over time, could provide an opportunity for increased demand for scrap by integrated mills. These 3 trends bear watching.

Looking now at the U.S. market.

Average steel mill utilization has been below 70% since September. And as our domestic scrap and finished steel customers approach calendar year-end, we're seeing typical customer destocking.

As a result of these factors, domestic scrap prices have fallen in September and October. But looking forward into calendar year '17, restocking at the mills and the reduced scrap flows that we typically see in the winter months could reverse this trend as it did last year.

So now let's turn to Slide 6 so you can see how these market movements influenced our financial and operating results. On this slide, you can see very clearly the impact on our results from the first half, second half dichotomy of the market trends we've just reviewed.

You can also see the positive impact from our productivity and cost reduction initiatives, including some of the cost-saving synergies that we achieved from the integration of our legacy Metals Recycling and Auto Parts division.

Despite a decline in total ferrous sales volumes versus fiscal '15, our focus on cost reduction, production efficiencies and aggressive asset management enabled us to double our full year adjusted operating income per ton in AMR.

In our Steel Manufacturing Business, our ability to reduce cost and improve productivity enabled SMB to partially mitigate the headwinds of lower prices and lower year-over-year volumes.

SMB's adjusted operating income was higher than the third quarter but less than last year's fourth quarter due to the adverse impact on prices and volumes from finished steel imports. While we anticipate sequentially lower ferrous and finished steel prices and volumes in the first quarter of fiscal '17, we expect that our cost savings, productivity initiatives and internally generated synergies will enable us to deliver improved consolidated performance versus Q1 of last year.

So now let me turn it over to Richard for a more detailed review of our segment performance and our capital structure.

Thank you, Tamara. I'll start with a review of AMR's fourth quarter performance.

AMR's adjusted operating income of $20 million was 25% higher than the same quarter in the prior fiscal year. The increased profitability came mainly from new cost savings and productivity benefits, which more than offset the lower prices and volumes.

These new cost efficiencies were achieved through several focused initiatives, including reductions in operational and sales labor, lower IT and marketing expenditures and savings in transportation costs and outside services.

As the fourth quarter included a significant decline in market prices, AMR's results were lower sequentially because the third quarter had benefited from rising market conditions and a spike in prices. As a result of these trends, the fourth quarter included an estimated $3 million adverse impact from average inventory accounting compared to a benefit of $3 million in the previous quarter.

This net change of $6 million was the major difference in AMR's sequential performance.

During the quarter, we shipped 914,000 ferrous tons at an average selling price of $209 per ton. The volumes were 2% lower than last year's fourth quarter, and the average prices were down by 10% year-over-year.

Sequentially, ferrous volumes were up by 10%, reflecting a combination of our sales activity, steady scrap supply and reducing our inventory.

Average ferrous sales prices were lower sequentially by only $6 per ton, which reflected the contrast in market trends within each quarter.

Due to weaker year-over-year demand, nonferrous volumes and average sales prices also declined by 13% and 17% respectively from the prior year period. Sequentially, nonferrous selling prices were flat and sales volumes were up 25% through increased production, timing of shipments and higher nonferrous extraction, including from increased car purchase volumes, which were up by 16% sequentially and by 5% year-over-year.

Looking to the first quarter of fiscal '17, we are anticipating ferrous sales volumes to be slightly above the first quarter of fiscal '16 and nonferrous sales volumes to be up by approximately 15% year-over-year.

Through the first 2 months of the first quarter, average selling prices are down sequentially, but the size of the drop has been significantly less than what we experienced during September and October of 2015. Together with softer volumes, the price decline we have seen in the quarter to date is anticipated to lead to operating income per ton to be down sequentially but still significantly higher than last year's first quarter, reflecting continuing benefits from our cost reductions and productivity initiatives.

Now moving on to Slide 8 to review SMB's operating trends and performance. For the fourth quarter, SMB's adjusted operating income was $3 million, which was an improvement sequentially, resulting from higher sales prices and increased capacity utilization of 71%.

Average sales prices of $528 per ton were 5% better sequentially due to higher-priced shipments in the first half of the quarter. Compared to last year's fourth quarter, prices were down by 12% on lower scrap input costs and competition from finished steel imports along the West Coast.

Sales volumes for the quarter were at 123,000 tons, a decline of 8% sequentially and 15% lower year-over-year. The adverse impact of low-priced steel imports on SMB's volumes and prices has more than offset favorable construction markets in West Coast states.

During the fourth quarter, SMB recognized approximately $2 million in asset impairments as a result of new productivity initiatives aimed at lowering overall manufacturing costs and enhancing product quality.

These initiatives involve decommissioning all the rolling mill equipment and upgrading their more advanced rolling mill facility.

For the first quarter of fiscal '17, SMB expects sales volumes will be less than the fourth quarter on customer destocking, the falling price environment in the first 2 months of the quarter and continuing pressure from an overhang of import-related inventories. As a result, and including downtime associated with equipment upgrades, which will have an impact of approximately $2 million, SMB's anticipated operating performance for the first quarter is expected to be slightly below breakeven.

Moving to Slide 9, I'll summarize our operating cash flows and our capital structure. During fiscal '16, we continued our trend of positive operating cash flows by generating $99 million during the year with $48 million in the fourth quarter, including contributions from both of our operating segments.

The proportion of operating cash flow derived from profitability has increased, with reduced benefits from drawdown of working capital.

The fourth quarter cash flow included the $6 million insurance reimbursement, which we recorded in our corporate segment. Looking ahead to fiscal '17, we expect the quarterly run rate for corporate costs to be similar to the fiscal '16 average, excluding the benefit of the insurance recovery.

Although the first quarter is historically weaker due to seasonal factors, from a consolidated perspective, we currently anticipate positive consolidated operating income for the first quarter of fiscal '17, which would represent an improvement over the first quarter in the last fiscal year.

During the fourth quarter, we reduced net debt by $30 million, which brought debt levels to 5-year lows. As of the end of the fiscal year, net debt was down to $166 million, with a leverage ratio of 25%.

Capital expenditures totaled $13 million in our fourth quarter, and for the year as a whole, CapEx was $35 million. This level was slightly higher than last year and was spent on upgrading equipment and infrastructure and on environmental and safety-related projects.

Looking ahead to fiscal '17, we expect capital expenditures to be in the range of $45 million, with a continued focus on maintenance CapEx, environmental and safety-related programs.

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

Thank you, Richard. Last year, at this time, I said that we had laid the groundwork to deliver higher results in fiscal '16 despite a still soft market outlook.

Our fiscal '16 results clearly illustrate the power of our initiatives to increase long-term shareholder value through a variety of strategies intended to drive operational and economic performance. We saw the benefits of our cost reduction and productivity initiatives come through strongly as volumes improved in the second half of our fiscal year although prices remained at historically low levels.

We generated significant SG&A savings, improved our raw material purchasing program across our Auto and Metals supply chain and invested in process improvements to enhance our logistics and reap productivity benefits at our steel mills.

Our focus on working capital management continued to strengthen our balance sheet, enabling us to reduce our debt and continue to return capital to our shareholders. And as we saw in the second half of the year, an improving market will allow us to deliver significant operating leverage from all of these actions.

Significant change is occurring across the competitive landscape and we are well positioned to take advantage of evolving market opportunities. At the same time, we remain focused on continuously improving our core operations, maximizing profitability and generating positive cash flow.

As we look ahead, we are not relying on the market to drive improved performance. We're continuing to direct our actions towards the things that we can control, lowering our cost, operating efficiently, meeting our customers' needs and generating synergies between our businesses.

In closing, I'd like to thank our most important resource, our employees. In fiscal '16, our business continued to withstand significant market challenges as you worked together across our platform and delivered on each target without wavering from our core values of safety, environmental stewardship and quality.

You have shown the highest level of professionalism, operational excellence and execution in the face of these global commodity headwinds. My thanks go to each of you as you've truly demonstrated why we have continued to be a leader in the recycling industry for well over a century.

Now operator, let's open up the call for questions.

The car purchase volumes were up from last year despite ferrous prices pulling back here as the quarter carried on. Do you think this is finally a reflection of some of the auto sales growth in previous years and a -- with a better supply environment?

Or are there some anomalies in the quarter to consider there?

Well, I think that there are a couple of drivers. I think one has been the benefit of the integration of our legacy Metals Recycling and Auto Parts platform because I think that a closer coordination has allowed us to -- I used to talk about clear out the cholesterol that was in that supply chain and drive volumes as the market improves.

So I think that is really the #1 driver. And then I think there has been more of a resetting of price expectations in the market as ferrous prices and nonferrous prices stabilized toward the end of the year.

Okay. And then, Tamara, we've read about, and you've certainly spoken to this, this industry consolidation and closures over the last few years.

Maybe for the locations or regions that you actually operate in, do you still feel like there's a lot of inefficient capacity out there?

Well, I think that we are still seeing, and you see it in the trade press weekly, we're still seeing the smaller players with less scale come out of the market. So I don't think that we are done seeing industry rationalization.

Okay. And then, I guess, kind of another bigger picture question.

You guys have done a great job kind of blocking and tackling to control costs, improve profitability through the downturn, and I certainly imagine that will continue. But now that you have the platform in a better place for today's environment, how much of your focus is shifting toward kind of building on the platform, whether it's M&A, or kind of aligning yourself with some new opportunities that you think could play out over the next 3 or 5 years?

Well, I think you've hit the nail on the head. I mean, that's exactly where our focus is, that's exactly where our planning is.

It is on identifying new customers, broadening our ability to -- or deepening our ability to serve them and broadening our reach and identifying new channels so that we can continue to drive increased volume and provide new products and new services to our customers.

This is actually Tyler Kenyon in for Phil. Tamara, I just wanted your perspective here on maybe what you're seeing just in the scrap export markets off both coasts, just for ferrous and nonferrous scrap.

And kind of what's your sense for where global scrap inventories are, either at the mill level or at the ports?

Sure. Well, generally, if we look at the ferrous markets, export prices are higher than domestic prices, and that's due to steady export demands and the recent low utilization in the U.S.

Iron ore prices in the high 50s have supported higher demand for scrap versus billets in the export markets, and you heard me mention that higher coking coal prices are giving EAS [ph] an advantage and over time, could lead to more scrap demand from the integrated. The U.S.

has been hurting, if you will, from softening auto production off peak levels and not yet a robust construction market and energy demand that's still weak and a strong dollar. But I think looking forward, normal conditions would have domestic trend towards export to support sufficient supply flows, and so I think that's where we see the ferrous market overall.

In terms of inventories, our domestic customers typically destock toward the end of the calendar year, and so that activity is similar to what we've seen in the past and typically reverses in the first early months of the new calendar year as supply flows contract through the winter and restocking occurs.

Okay. And then with respect to, Tamara, your comments with respect to pursuing just some evolving opportunities.

Where are you finding those opportunities, I guess, just broadly speaking in the export markets? Are there any particular regions where maybe you're not participating in, in a big way yet, where you think there could be some nice upside or any other shifts that maybe you could speak of?

Well, when we think about new markets, from a customer perspective, where we are -- we're reaching globally now, and we do add new countries and new customers on a quarterly basis and a full year basis. And I think our team did a great job this year, particularly in a low-volume environment, to expand our customer base and deepen and broaden those relationships.

When we look at expanding our platform, fundamentally, we focus on markets and opportunities where we can be competitive from either a wholesale, retail or logistics perspective because what we want to do is build on those strengths rather than rely on macro trends that we can't control.

Okay. And with respect to just the cost-savings program, Richard, you mentioned you've realized $14 million of the $30 million or so targeted as part of the more recent plan.

Any sense you could give us with respect to how you expect 8 [ph] of the cadence quarterly as to how we should be expecting some of those benefits to be realized as we move throughout the course of the year? And then any other incremental cost cuts which you're currently pursuing or could potentially target here in the future?

Yes. The -- as you said, we have achieved $14 million in fiscal '16 of our most recent $30 million annual target.

So we have $16 million to go, which we are targeting to achieve in fiscal '17 and mainly in the first half of fiscal '17, which is one of the reasons why we expect our first quarter performance to be improved over last year. In terms of how we're doing it, we have a wide-ranging program which is focused on reducing fixed costs and improving our productivity.

Some examples of that include our production costs in the areas of shift scheduling, eliminating downtime, outside services, transportation, savings, increasing the use of shared services, procurement savings and supplies and fuel and utility and a proactive asset management and program to manage our portfolio. So we continue to have a broad focus on efficiency in our organization, which is very much built into our culture and happens as part of our normal process at Schnitzer.

So the cost savings sound like they will be certainly more heavily weighted towards the first half of fiscal '17 is what you're saying?

That's right. And thereafter, these cost savings are baked in to our quarterly run rates.

But I'd like to stress that this is a continuous improvement, so we're always looking for efficiency as we move forward.

Okay. And then just one last one for me.

Richard, you mentioned you expected the operating income per ton to move slightly lower in the fiscal first quarter, relative to the fourth quarter. If -- correct me if I'm wrong, but does that include any expected inventory accounting headwind or tailwind within that assumption?

Yes, it does. As I mentioned in the prepared remarks, our fourth quarter had an adverse average inventory effect included in the adjusted results of about $3 million.

We expect the impact on the first quarter still to be adverse but not as much as the $3 million hit we experienced in quarter 4.

Thank you, operator, and thank you, everyone, for joining us on our call today and for your interest in our company. We look forward to speaking with you again when we announce our first quarter results in January '17.

Thank you.