Commercial Metals : Q3 Fiscal 2021 Investor Presentation

INVESTOR PRESENTATION

JULY 2021

CAUTIONARY STATEMENTS

This presentation contains or incorporates by reference a number of "forward-looking statements" within the meaning of the federal securities laws with respect to general economic conditions, key macro-economic drivers that impact our business, the effects of ongoing trade actions, the effects of continued pressure on the liquidity of our customers, potential synergies and organic growth provided by acquisitions and strategic investments, demand for our products, metal margins, the effect of COVID-19 and related governmental and economic responses thereto, the ability to operate our steel mills at full capacity, future availability and cost of supplies of raw materials and energy for our operations, share repurchases, legal proceedings, the undistributed earnings of our non-U.S. subsidiaries, U.S. non-residential construction activity, international trade, capital expenditures, our liquidity and our ability to satisfy future liquidity requirements, estimated contractual obligations and our expectations or beliefs concerning future events. The statements in this report that are not historical statements, are forward-looking statements. These forward-looking statements can generally be identified by phrases such as we or our management "expects," "anticipates," "believes," "estimates," "future," "intends," "may," "plans," "ought," "could," "will," "should," "likely," "appears," "projects," "forecasts," "outlook" or other similar words or phrases, as well as by discussions of strategy, plans, or intentions. There are inherent risks and uncertainties in any forward- looking statements. We caution readers not to place undue reliance on any forward-looking statements.

Our forward-looking statements are based on management's expectations and beliefs as of the time this presentation was prepared or, with respect to any document incorporated by reference, as of the time such document was prepared. Although we believe that our expectations are reasonable, we can give no assurance that these expectations will prove to have been correct, and actual results may vary materially. Except as required by law, we undertake no obligation to update, amend or clarify any forward-looking statements to reflect changed assumptions, the occurrence of anticipated or unanticipated events, new information or circumstances or any other changes. Important factors that could cause actual results to differ materially from our expectations include those described in Part I, Item 1A, Risk Factors, of our annual report on Form 10-K for the fiscal year ended August 31, 2020 and in Part II, Iteam 1A, Risk Factors or our subsequent quarterly reports on Form 10-Q, as well as the following: changes in economic conditions which affect demand for our products or construction activity generally, and the impact of such changes on the highly cyclical steel industry; rapid and significant changes in the price of metals, potentially impairing our inventory values due to declines in commodity prices or reducing the profitability of our downstream contracts due to rising commodity pricing; impacts from COVID-19 on the economy, demand for our products, global supply chain and on our operations, including the responses of governmental authorities to contain COVID-19 and the impact from the distribution of various COVID-19 vaccines; excess capacity in our industry, particularly in China, and product availability from competing steel mills and other steel suppliers including import quantities and pricing; compliance with and changes in existing and future government laws, regulations and other legal requirements and judicial decisions that govern our business, including increased environmental regulations associated with climate change and greenhouse gas emissions; involvement in various environmental matters that may result in fines, penalties or judgments; potential limitations in our or our customers' abilities to access credit and non-compliance by our customers with our contracts; activity in repurchasing shares of our common stock under our repurchase program; financial covenants and restrictions on the operation of our business contained in agreements governing our debt; our ability to successfully identify, consummate and integrate acquisitions, and the effects that acquisitions may have on our financial leverage; risks associated with acquisitions generally, such as the inability to obtain, or delays in obtaining, required approvals under applicable antitrust legislation and other regulatory and third party consents and approvals; operating and start-up risks, as well as market risks associated with the commissioning of new projects could prevent us from realizing anticipated benefits and could result in a loss of all or a substantial part of our investment; lower than expected future levels of revenues and higher than expected future costs; failure or inability to implement growth strategies in a timely manner; impact of goodwill impairment charges; impact of long-lived asset impairment charges; currency fluctuations; global factors, such as trade measures, military conflicts and political uncertainties, including the impact of the Biden administration on current trade regulations, such as Section 232 trade tariffs, tax legislation and other regulations which might adversely impact our business; availability and pricing of electricity, electrodes and natural gas for mill operations; ability to hire and retain key executives and other employees; competition from other materials or from competitors that have a lower cost structure or access to greater financial resources; information technology interruptions and breaches in security such as cyber attacks, hacks, malware, or other intrusions including resulting costs and reputational damage; ability to make necessary capital expenditures; availability and pricing of raw materials and other items over which we exert little influence, including scrap metal, energy and insurance; unexpected equipment failures; losses or limited potential gains due to hedging transactions; litigation claims and settlements, court decisions, regulatory rulings and legal compliance risks; risk of injury or death to employees, customers or other visitors to our operations; and civil unrest, protests and riots.

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THE LEADER IN CONCRETE REINFORCEMENT

• Highly focused producer of long steel and wire products
  No. 1 producer of rebar in the U.S. and Poland; Poland operations serve growing economies in Central
  and Eastern Europe
• Leader in attractive rebar and merchant bar (MBQ) markets with highly flexible, low-cost mills; best-in-class customer service; and track-record
  of product innovation
• Downstream demand optimizes mill production volumes, regardless of import levels

• Significant self-funded growth
• • Acquired 4 mills and 33 rebar fabrication facilities creating meaningful long-term value
  • Executing on merchant bar and new product organic growth opportunities
  • Constructing new state-of-the-art micro mill in Arizona; completing expansion in Poland
• Strong balance sheet supported by enhanced earnings and cash flow capabilities
• • ROIC1 well in excess of cost of capital
  • Net debt-to-EBITDA of 1.0x1

Note:

1. ROIC and net debt-to-EBITDA are non-GAAP financial measures. For a reconciliation of non-GAAP financial measures to theInvestor Presentation | July 2021 3 most directly comparable GAAP financial measures, see the appendix to this document

Q3 HIGHLIGHTS - RECORD FINANCIAL RESULTS

		• Domestic construction market remained active
	Y	• MBQ demand driven by manufacturing recovery
	ACTIVIT		as price increases were realized
	MARKET	•	Margins on steel products expanded throughout Q3
	•	Strong downstream bidding and new award activity
		• Robust construction related demand in Poland;
			Central European industrial activity recovering
		• Core EBITDA1 of $230M - new record
	S	•	Adjusted EPS1 of $1.04
	RESULT	•	ROIC (annualized)1 of 18%
	FINANCIAL	• ROE (annualized)1,2 of 26%
	•	Record Europe segment Adjusted EBITDA of
		•	Record North America segment Adjusted EBITDA

of $207M $50M

PROGRES ON BUSINESS STRATEGY

SHEET AND	FLOWS
BALANCE	CASH

• Began commissioning 3rd rolling line in Europe - expect commercial production in late Q4
• Received air permit for Arizona 2 project - construction is underway
• California land sale in process
• Further progress in MBQ initiative
• Published enhanced Corporate Sustainability Report in late June
• Cash balance of $443M
• Last 12-month operating cash flow of $354M
• Net Debt-to-EBITDA ratio1 of 1.0x
• Net Debt-to-Capitalization1 of 20%
• Paid 227th consecutive quarterly dividend

Notes:

1. Core EBITDA, Adjusted EPS, ROIC, ROE, net debt-to-EBITDA, and net debt-to-capitalization are non-GAAP financial measures. For definitions and reconciliations of non-GAAP financial measures to the most directly comparable GAAP financial measures, see the appendix to this document
2. Return on equity is calculated as annualized third quarter Adjusted earnings from continuing operations divided by trailing 12-month average Total Stockholders' Equity

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BACKGROUND AND STRATEGY

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