Brian R. Hedges – President and Chief Executive Officer Marion E. Britton – Chief Financial Officer, Executive Vice President and Secretary John G. Reid – Vice President and Chief Operating Officer

Anthony Zicha – Scotiabank David Galison – CIBC World Markets Justin Wu – GMP Securities Frederic Bastien – Raymond James & Associates Bert Powell – BMO Capital Markets Corinna Petry – American Metal Markets

Good morning, ladies and gentlemen; and welcome to the Second Quarter 2013 Conference Call. Today’s call will be hosted by Mr. Brian Hedges, President and Chief Executive Officer; Ms. Marion Britton, Executive Vice President and Chief Financial Officer; and Mr. John Reid, Executive Vice President and Chief Operating Officer of Russel Metals Inc. Today’s presentation will be followed by a question-and-answer period. (Operator Instructions) I will now turn the meeting over to Ms. Marion Britton. Please go ahead? Marion E. Britton: Good morning, everyone. We’ll start with reading normal cautionary statement. Statements contained on this conference call that relate to Russel Metals beliefs or expectations as to certain future events are not statements of historical facts and are forward-looking statements. Russel Metals cautions readers that there are important factors, risks and uncertainties, including but not limited to, economic competitive and governmental factors affecting Russel Metals’ operations, markets, products, services and prices that could cause its actual results, performance or achievements to be materially different from those forecasted or anticipated in such forward-looking statements. The forward-looking statements in this document reflects Management’s current beliefs and are based on information currently available to Management. The material assumptions applied in making the forward-looking statements in this document includes the following. Demand from the manufacturing resource and construction segments of the Canadian economy remains at current levels and these conditions will continue in the foreseeable future; and oil and gas prices; the price of steel, the value of the Canadian dollar relative to the U.S. dollar will be stable and at similar levels to what we experienced at the end of the second quarter. Although the forward-looking statements contained in this document are based upon what management believe to be reasonable estimates and assumptions, Russel Metals cannot ensure that actual results will not be materially different from those expressed or implied in those forward-looking statements and do not intend to update any forward-looking statements other than required by law. So, if you can flip to page five, make some comments on the quarter and the market conditions. So our result this quarter were driven mainly by lower demand and competitive low pricing in service centers and steel distributors. Our Energy with Apex was more positive, although the weather in Alberta did impact drilling activity. The current conditions of demand was the economic slowdown has impacted demand in service centers. MSCI indicated 8% down for Canada, and 3% for U.S. Russel experienced a 4% down, which is slightly better based on our weight in Canada/U.S. than the industry is experiencing are down year-to-date it’s 7%, but we are up over Q1 2013. Pricing is low but it seems to be stable and maybe rising slightly through the third quarter. Drilling activity was lower than anticipated, as I mentioned due to wet weather flooding in Alberta. We do expect the drilling activity to pick up through the third quarter, and improvement in this area in the fall. Turning to the next page, our actual numbers, earnings are $19.9 million for the quarter. EPS of $0.33 compares to same quarter last year $0.225 versus $0.37 of EPS, and $0.217 for the third quarter $0.36 of EPS. And they are, as indicated, our six month June 30 numbers with an EPS of $0.70 per six month in 2013. We still continue to have a strong free cash flow, the six months was $49.8 million or $0.82 per share. Our return on equity up 10%, and cash position is positive at $1.39 of net cash position. If you go to page, the highlights on the cash flow page 10, you’ll note that, what is happening here with our change in cash working capital was positive, both in the quarter and for the six month period, that’s consistent with model as our revenues are down. We would be throwing off cash. So our cash is up on a net basis, approximately $26 million in the quarter. Turning forward to page 14, we’re going to make some specific comments on each segment related to the quarter. As I was mentioned the revenues are down 13%, the revenues are down 13%, this is driven by tons down 4% pricing down 9% compared to the same quarter of last year. One positive thing is there is a slight improvement based on working days and on what we did see in first quarter of 2013. The demand reduction seem to be more pronounced in the Eastern part of Canada, driven by manufacturing activity. The West was somewhat impacted by the weather, but, that will show some improvement in the second half of the year. The margin was consistent with last year same quarter 20.4%, down slightly from first quarter, but in a range that we would expect based on pricing and stability of the pricing at this point in time. Moving forward to page 16, in terms of specific comments on the energy groups, revenues were up 6%, obviously a good portion of that is driven by the acquisition of Apex distribution. On a same store basis our energy group was up 11% in the quarter and that was driven by – mainly by Comco activity in oil sands, they had a strong quarter. The second quarter for our energy group is the low point in our drilling activity. So, we’re off our first quarter. The other areas that I want to comment in relation to increases are both gross margin and expenses. The higher gross margin is driven by the higher gross margin achieved at our Apex operations, they operate slightly more like a service centre in relation to gross margin and in relation to expenses. So, I want to point out that – some people have noted our expenses are up, but our expenses actually are up driven by the acquisition. And so, energy as a percent of revenue is at 10.4%, compared to 8.5% the year before. But on a same-store basis, it’s actually 7.4%, so which is really an improvement in that segment. And our expenses are down in all our other segments. So I'll just caution people to look at what’s going on with the expenses and the margins at Apex for people that are doing modeling. The third segment, steel distributors. There was volume decline in that segment based on the period last year and Q1. They are actually waiting for improvement in the service center side. They are not seeing demand improvements. So they’re not forcing revenues because they know that pricing and demand is just not out there. So this segment will remain fairly quiet through 2013, we anticipate. Turning to page 18, I want to comment on other finance expense that consists in 2013 that a line is specifically related to the contingent consideration in Apex and the amount on a year-to-date basis that has been put up is CAD3 million, and that does drive our income tax rate. So, we’ve noted under income tax is why we have a higher tax rate for the quarter, and specifically that amount is not tax affected, so it will adjust according to income level, it’s the – fact it’s not effect, it can drive the income tax rate slightly higher. The other comments I’ll make are on a page 20. You’ll note that our inventory balances are down in Metal Service Centers and Steel Distributors; is consistent with last June but there are low levels, we consider them to be in line with demand. The increase in energy mainly relates to the acquisition of Apex, you see the increase from $241 million last June to $427 this June. Energy has a little bit (inaudible) charges, in fact that was slower in the last part of the quarter. We think that we’ll post returns there will improve with the third part of revenue increase. And the other comment is on page 21, we did redo both of our bank facilities in the quarter. We have now extended our main facility to the facility (inaudible) from $252 million up to $325 million, there was some positive improvement on the fees and interest cost under that facility, so we’ll have that lined up for any activity as we go into hopefully higher working capital requirements. And that comments on the extension of the U.S. facility on page 22 also extended for a one-year term. Those are my comments on the quarter. I’ll turn it back for questions.

(Operator Instructions) Our first question is from Anthony Zicha from Scotiabank. Please go ahead sir. Anthony Zicha – Scotiabank: Hi, Good morning, Marion. Marion E. Britton: Hi, Anthony Anthony Zicha – Scotiabank: With reference to Energy project segment; excluding the Apex acquisition, can you give us some color on the competitive nature of the market and maybe give us some color on pricing behavior? Brian R. Hedges: On the OCTG, it remains very competitive. You are talking ex-Apex or Apex now? Anthony Zicha – Scotiabank: Ex-Apex Brian Brian R. Hedges: Ex-Apex Marion E. Britton: Okay, fine. Brian R. Hedges: The OCTG market is really competitive. There is a lot of product out there. And the quarter didn't have the dumping action impacting it. We’ll see what this quarter does. And then prices have trended up slightly on OCTG seamless products since the dumping action was taken in the stage. Line pipe had not moved much and there is still an awful lot of inventory. So those areas are still under pressure. The oil sands has been okay. So Comco had a very good quarter. And our pioneer operation had a pretty good quarter not as good as last year, but, they had record numbers last year. So, those areas are a little healthier and Comco is mostly, again as I said oil sands and pioneers mostly line pipe. But the OCTG is very competitive and I think it’s going to remain that way for awhile. Anthony Zicha – Scotiabank: Okay. And are there some consolidation opportunities in that market? Brian R. Hedges: Well, it depends on what you want to pay for this. There is always consolidation opportunities out there, but – yes, they're there. I mean there is companies that are struggling that are public like Edgen. There are a lot of distributors out there that would love to sell. But they’re hard, as I said in prior calls, hard to buy, because you’re basically just buying pipe stored in truckers’ yards somewhere. So it’s really hard to do a transaction, but there is certainly is going to be some fallout from all the seamless capacity that’s coming on line in the next two to three years. Anthony Zicha – Scotiabank: Okay. Brian R. Hedges: That’s on the mill side. Anthony Zicha – Scotiabank: Brian, with reference to steel service centers; the tonnage shipped was 4%, and you mentioned that Atlantic and Ontario and Quebec had more difficulty than the rest of Canada. So how was the rest of Canada performance? Was it like zero compared to minus 4 or was it… Brian R. Hedges: Yeah, I’d acknowledge. Though it’s not positive, it’s very flat, and it’s right around the zero level. Anthony Zicha – Scotiabank: It was flat. And then last question; with reference to offshore imports, can you give us any color on that? Has there been any change in trends? Thanks. Brian R. Hedges: The imports have dropped. The spread between the offshore and the importing, and the domestic prices is not big enough and safe enough because of the lead times. Our traders, they’re not in the market. We have the lowest sales fees outstanding we’ve ever had. They’re just not bringing product in because you can’t guarantee that the prices aren't going to fall further. But starting to reverse a little bit. But the actual gross number for all the industry is down. The only fear I have right now with all those countries that remained in the dumping in the States will divert product to the West Coast of Canada; Korea and places like that. So you may have an influx of the OCTG and line-pipe products in the ERW. Anthony Zicha – Scotiabank: Okay. Brian R. Hedges: We haven't seen it, but it could happen. Anthony Zicha – Scotiabank: Okay; thank you Brian and Marion.

Thank you. Our next question is from David Galison from CIBC World Markets. Please go ahead. David Galison – CIBC World Markets: Hi, good morning, guys. So just looking at Apex, we had a pretty big increase in revenue quarter-over-quarter. Just wondering what was behind that considering the seasonality in the quarter? And also if you could touch on margins in that segment, seem to be down a bit for Apex. Brian R. Hedges: Yeah, well, Apex is a much more stable revenue pattern in our oil country players. So although, they slowdown in the second quarter and that was obviously impacted by the weather as well. But they will always have a little bit of a slowdown in the second quarter, but it's not as dramatic as the rest. So what you're seeing, when you see the margin drop from the first to the second, it’s actually smaller than it normally is for us, because Apex has had a positive influence even though they saw (inaudible) well a little bit. David Galison – CIBC World Markets: And then, if you just look at how revenue has actually been trending in the first half, it seem to be well above what you’re, I guess, looking for and also what it did last year. Just – what your thoughts are for Apex in the second half from a revenue standpoint? Brian R. Hedges: Well, again, the seasonality, they’ll improve in the next two quarters versus second quarter even if the market was flat, they would improve. But we do see – there will be a catch-up activity. A lot of the drilling has been delayed for various reasons associated with weather. But people are going to try to catch-up on that delay, so some of the drillers have got to produce again X volume of new wells every year and volume. My guess is you're going to see a bit of a surge, but it's not necessarily a total recovery, it's really just a catch up… David Galison – CIBC World Markets: Okay. Brian R. Hedges: …on what they miss. David Galison – CIBC World Markets: Okay. And just on the outlook for some pricing improvements in the second half, should we expect to see some margin improvement along with that in the second half, and how should we think about inventory purchases, I guess, with the prices being at the bottom close?

Certainly, this last round of flat roll increases have partially stuck. So there's a slight uptick in the pricing of steel, black steel. On the pipe side, I don't think you're going to see much movement on ERW. You may see in the States a slight recovery in the seamless products because of the dumping. Marion E. Britton: Unless we get a big increase in demand, I don't anticipate that inventories as much. David Galison – CIBC World Markets: Okay. All right; thank you very much.

Thank you. Our next question is from Justin Wu from GMP Securities. Please go ahead. Justin Wu – GMP Securities: Hi, good morning. Just my first question is a point of clarification. Do you guys do much in terms of seamless or is it pretty much ERW? Brian R. Hedges: It's mostly ERW. We've done some larger diameter in the States for mid-stream stuff. But mostly our focus is on ERW. But now, they're increasingly using seamless in the well profiles for the horizontal, so we are starting to sell more seamless all the time, because of the strength of it and the premium connections. It will allow them to go horizontal. So certainly that's an area of growth for us, but of course at the same time, the conventional drill pipe is dropping off. Justin Wu – GMP Securities: Okay. And you comments in terms of ERW pricing. It would assume that given that the substrate hot rolled has been moving up more than 10%, almost 15% in the past month and a half or two months; would that not trickle through to some of the pipe makers? Brian R. Hedges: Well, I don't think you're going to see it. There's enough inventory out there. I don't think you’ll see it until late in the fourth quarter or early in the first quarter at the building time in the industry. But I think it will take that long for the existing inventory to work through. Justin Wu – GMP Securities: Okay. And just in terms of overall demand; the soft patch that we saw in the second quarter with industry volumes down 8%; were there any specific industries where you saw the biggest weakness? Obviously certain areas like the automotive have been quite robust and I understand that you don't do very much in that market, but is there any particular segment that you saw a lot of weakness? Brian R. Hedges: For us it was across the board, I mean obviously some of the heavy equipment guys, Cat and people like that, had weaker numbers. There are still some positive areas, but it's pretty much everywhere in the manufacturing sector. Again, the prairies are not quite as weak and we expect that to pick up in the third quarter. Justin Wu – GMP Securities: So that's more ag stuff, right? Brian R. Hedges: Yeah, I mean in the States you're seeing some talk about non-res. We haven't yet come through to the, in any big numbers. I mean they're building more houses, but we haven't seen a big pick up. But there's little bit of positives there, but it's not a big enough number yet to offset the other side. Justin Wu – GMP Securities: Okay. And just in terms of the Comco project business, was that, I know that business tends to be fairly lumpy; but was it just a timing of that project; that's why the quarter was so strong there? And what's the outlook for the back half of the year for Comco? Brian R. Hedges: Well the project revenue, I mean, there haven’t been any new project in a while. They are just filling in on the spot market, basically reacting to small bit and they have the right product and the right mix. So they are actually doing a lot more business in their non-project than they use to. And they’ve been very successful. We do see us maybe slowing down a little bit in the second half; in that one area. Anthony Zicha – Scotiabank: Okay, great. Thank you.

Thank you. Our next question is from Frederic Bastien from Raymond James. Please go ahead. Frederic Bastien – Raymond James & Associates: Thank you. Brian, I just want to follow up on that last question that was asked, you said the non-business for Comco; what are you referring to? Brian R. Hedges: Well Dave, due to the large project business. They always have a volume that’s just basically a spot based, somebody comes and need something or a small bit that’s out there that they small bid that's out there, that they fill day to day, that builders which is actually higher margin for them is now the bigger piece of their business than it's ever been, and that’s how they’re filling in from a lack of new projects. So it’s the day-to-day, it could be Suncor still; but it's not for a Suncor project. It's just something they need somewhere in their system. We’re getting more of that business than we’ve done historically. Probably, be somewhere why, because our people aren’t always attracted doing the big projects. Frederic Bastien – Raymond James & Associates: Got it. We've had a couple of big announcements last week; the first one being the Potash cartel dismantling and the second one being TransCanada’s East pipeline basically receiving approval. How do these developments impact your business? Brian R. Hedges: Well, short term, obviously Potash is not a good one. That’s going to impact the Saskatchewan boom a little bit; although you still get the Balkans going on there, so that's positive. And the pipeline, I think, is a psychological thing. I think it makes people be positive, obviously, Alberta has got to solve the problem of how they're going to move that oil with the finding. So anything that’s going to move oil out of that province is not on a railway probably is a positive announcement. But short-term, it's not going to do anything, obviously. But I think the potash one, the jury is out. The question really is, do the prices of potash drop dramatically because of the breakup of the Russian cartel or do they reform it? I mean I don't know what's going to happen there, but certainly short term that's not a good happening for us, because we do bid a lot of projects into the potash mines. Frederic Bastien – Raymond James & Associates: Okay, you touched on that a bit earlier, but there are some distributors out there that fear that the dumping complaint against the foreign producers of OCTG might actually put further pressure on the line-pipe market because you're going to see capacity move to that market. Is that something that is of concern to you? Brian R. Hedges: Obviously if it happens, it's going to be a concern. I don't see that, necessarily be byproduct of this. So we'll see what happens, but hang on line pipes have lots of product right now anyway. There is not as many opportunities there for the large project bids in that. So it's a different product – it's less of a commodity product than some of the big, large bid products are. So I think it's a little bit better protected. Frederic Bastien – Raymond James & Associates: But what needs to really happen? I mean obviously the dumping – obviously there are a lot of things that could impact that business. There is obviously overcapacity. What needs to happen to fix that problem? Brian R. Hedges: We need a few people to buy some mills and close them down. I think of all the new product coming on line in the actual seamless side. So that's going to impact that. However, you've got to remember there's a large import market in the pipe market. That can be, at times, 50% of the supply so if you can block that then there is some there is obviously extra capacity, extract product to be sold by the new mill. So there’s a lot more import on the pipe side than there is on the steel side. So if they block that successfully, obviously, it will stabilize the market better than it would have been otherwise. Frederic Bastien – Raymond James & Associates: Got it. Okay, perfect. Thanks for that.

Thank you. (Operator Instructions) Our next question is from Bert Powell from BMO Capital Markets. Please go ahead. Bert Powell – BMO Capital Markets: Thanks. I just wanted to make sure I’ve got the seasonality down for Apex. If I look at the quarter, 11% up on same-store sales basis, which would imply, I think, about CAD100 million in for Apex. And as I recall, when you did that, that was kind of running CAD500 million in revenue. Is that kind of the – if I divide that evenly and look at the delta, it’s about a CAD25 million swing between the low and what the average would be. Is that the right way to think about it? Brian R. Hedges: You may, it’s as good as – you can look at it, there’s two things. The CAD500 million had line-pipe sales in it for Canada. We closed that down. So there was a portion of that that was a product line that we're no longer in. We didn't want them in that. And then you get the seasonality drop. So year-over-year, the second quarter would be the weakest anyway. You can't just divide it up into four. There is some seasonality at Apex, it’s just not as dramatic at the other oil country operations. Bert Powell – BMO Capital Markets: Okay. So what would be… Brian R. Hedges: But it’s a little bit strong on your number. Bert Powell – BMO Capital Markets: So what was the line-pipe contribution to the revenue base that you define? Marion E. Britton: Well, I think our number would be around CAD450 million is the revenue number that you should be thinking. In the MD&A, we have disclosed the CAD217 million, which is the year-to-date revenue they had. So, we expect the second half to be slightly stronger. So if you take that, you should end up around CAD450 million, I would think. Bert Powell – BMO Capital Markets: Okay, perfect. And then just in terms of the Comco business, is that sustainable or was there something that was driving that was just a confluence of events that brought that in for the quarter? Marion E. Britton: It was just other little things that were going on with customers that they do work with. I mean, as Brian indicated, small bid projects, nothing on our large project work, but activity that was going on, and they happen to have the product that was needed at that time. Bert Powell – BMO Capital Markets: Okay. So that is nothing anomalous? Brian R. Hedges: No. Marion E. Britton: No. Bert Powell – BMO Capital Markets: Okay. And then, Brian, how are thinking about in the service center business, how are thinking about pricing over the balance of the year from the best intelligence you have today and then based on what you're going to seeing? Brian R. Hedges: Margins were up a tiny bit in this quarter, even though prices didn’t recover late in the quarter. I know, I think, the scenario we're seeing where flat rail prices have started to edge-up, we'll get the slight improvement in margin that – I don’t think it’s going to jump dramatically, but there's going to be an improvement. Bert Powell – BMO Capital Markets: Okay, thank you.

Thank you. Our next question is from Corinna Petry from American Metal Markets. Please go ahead. Corinna Petry – American Metal Markets: Good morning. I'm also asking about the loss – the complaint, the dumping complaint. Brian, you said something about it pushing product from one country to another. Could you be a little more specific about what the concern is there? Brian R. Hedges: Well, if they've got product that they – might have otherwise tried it with the United States. The other North American location that you can easily get it into right now is Canada. I mean because (inaudible) drilling patches has used foreign pipe fairly largely. So that's where it will end up if excess. This whole dumping action that we're getting now, I mean, it's looking to block some of the dumping that was done in China. I mean China has been can't ship into Canada for the last several years, but all they were doing was moving their raw green tubes to Vietnam and having them end finished and then brought in. So, we are trying to block some of that, which of course is just Chinese pipe by another name. Corinna Petry – American Metal Markets: Got it. Thank you.

Thank you. There are no more questions registered from the phone lines. I would like to turn the meeting back over to Ms. Britton. Marion E. Britton: Thanks everybody for attending. Have a good summer and we'll talk to you next quarter.

Thank you. The conference call has now ended. Please disconnect your lines at this time. We thank you for your participation.