EMJ Reports Third Quarter Fiscal 2004 Results.

Business Editors

LYNWOOD, Calif.--(BUSINESS WIRE)--Jan. 29, 2004

The Earle M. Jorgensen Company ("EMJ") today reported results for the company's third fiscal quarter and the first nine months ended Jan. 1, 2004.

Revenues increased 11.3% to $248.8 million and operating income increased 6.5% to $14.7 million for the third quarter of fiscal 2004, when compared to $223.6 million and $13.8 million, respectively, for the same period in fiscal 2003. Net income was $1.2 million for the third quarters of both fiscal 2004 and fiscal 2003.

For the first nine months of fiscal 2004 revenues increased 6.6% to $718.3 million when compared to $673.9 million for fiscal 2003. Operating income increased 49.7% to $44.9 million for fiscal 2004, as compared to $30.0 million for fiscal 2003. Fiscal 2003 included a loss of $12.3 million resulting from early termination of debt. Net income for the nine months ended Jan. 1, 2004 was $5.3 million compared to a loss of $5.6 million for the same period in fiscal 2003. Fiscal 2004 results included a gain of $1.1 million from the sale of surplus property and $4.4 million of pre-tax income for redemption of life insurance policies for the first nine months of fiscal 2004.

Maurice S. Nelson, Jr., EMJ's President and Chief Executive Officer stated: "We continue to be pleased with our results for the first nine months of Fiscal 2004 which were achieved in a challenging economic environment. We are seeing strong signs of recovery in the manufacturing sectors that we serve and we were particularly pleased with sales activity in December.

"Our gross and operating margins have remained consistent throughout fiscal 2004, reflecting our ongoing strategy of successfully marketing our core products and services while maintaining disciplined cost controls. We believe this strategy, together with maintaining balanced inventories, has and will continue to allow us to effectively compete in the marketplace.

"The company opened its newest satellite facility in Orlando, Florida during the quarter to expand its service to customers in the Southeast."

The company has completed the relocation of its corporate office to Lynwood.

EMJ is one of the largest independent distributors of metal products in North America with 36 service and processing centers. EMJ inventories more than 25,000 different bar, tubing, plate, and various other metal products, specializing in cold finished carbon and alloy bars, mechanical tubing, stainless bars and shapes, aluminum bars, shapes and tubes, and hot-rolled carbon and alloy bars.

The company has scheduled a conference call with industry analysts and other interested persons to discuss its third quarter and fiscal 2004 results. The call will take place on Jan. 30, 2004 at 7 a.m. (PST). The dial-in phone number for those interested in participating on the call is 800-370-8105. This press release can also be found on the company's Internet Web site at www.emjmetals.com/emjonline/pr.asp.

This release contains forward-looking statements as defined by the Private Securities Litigation Reform Act of 1995. Actual events or results may differ materially from expectations and are subject to risks, uncertainties and other factors over which we have no control, such as the cyclicality of the metals industry and the industries that purchase our products, fluctuations in metals prices, risks associated with the implementation of new technology, general economic conditions, competition in the metals service center industry and our "on-time or free" delivery guaranty. These factors and additional information are included in the company's reports on file with the Securities and Exchange Commission. In particular, we refer you to our Registration Statement on Form S-4 filed on July 3, 2002.

                      Earle M. Jorgensen Company
                         Financial Highlights
                              (in $000's)


                                    Three Months       Nine Months
                                       Ended:             Ended:
                                  Jan. 1, Dec. 31,   Jan. 1, Dec. 31,
                                    2004     2002      2004     2002

       Statement of Operations
        and Other Data:
Revenues                         $248,785 $223,573  $718,301 $673,936
Gross Profit                       68,805   63,719   199,907  190,596
   Warehouse and delivery expense  33,830   31,959    98,657   93,883
   Selling expense                  8,401    7,818    25,031   23,811
   General and administrative
    expense                        11,871   10,126    31,282   30,580
   Loss on early retirement of
    debt                               --       --        --   12,278

Operating expenses                 54,102   49,903   154,970  160,552

Operating income                   14,703   13,816    44,937   30,044
Net interest expense               12,995   12,529    38,205   35,086
Income before income taxes          1,708    1,287     6,732   (5,042)
Net income (loss)                   1,237    1,153     5,284   (5,628)
EBITDA (a)                         17,546   16,728    53,425   38,566
Capital expenditures                2,487    3,903     6,781   13,070

Reconciliation of EBITDA:
   Net income (loss)               $1,237   $1,153    $5,284  $(5,628)
   Depreciation and amortization    2,843    2,912     8,488    8,522
   Net interest expense            12,995   12,529    38,205   35,086
   Provision for income taxes         471      134     1,448      586

   EBITDA                         $17,546  $16,728   $53,425  $38,566

(a) "EBITDA" represents net income (loss) before net interest
expense, provision for income taxes and depreciation and amortization.
Consistent with Item 10(e) of Regulation S-K, the company's EBITDA has
not been adjusted to exclude any other non-cash charges (credits) or
liabilities, such as LIFO adjustments of $500, $(652), $500 and $(652)
and accruals for postretirement benefits aggregating $188 and $138,
$563 and $378 for the three months and nine months ended Jan. 1, 2004
and Dec. 31, 2002, respectively. In addition, the company's EBITDA for
the nine months ended Dec. 31, 2002 has not been adjusted for a loss
of $12,278 related to early retirement of debt. The company believes
that EBITDA is commonly used as a measure of performance for companies
in its industry and is frequently used by analysts, investors, lenders
and other interested parties to evaluate a company's financial
performance and its ability to incur and service debt. The company's
EBITDA is used by management as a performance measure to assess its
financial results in connection with determining incentive
compensation and is also used by the independent appraisal firm in
connection with its annual valuation of the company's equity. While
providing useful information, the company's EBITDA should not be
considered in isolation or as a substitute for consolidated statement
of operations and cash flows data prepared in accordance with
accounting principles generally accepted in the United States and
should not be construed as an indication of a company's operating
performance or as a measure of liquidity.


                      Earle M. Jorgensen Company
                         Financial Highlights
                              (in $000's)


                                                     Jan. 1, March 31,
                                                       2004      2003
       Balance Sheet Data:
Cash and cash equivalents                             $7,295  $20,030
Accounts receivable, net                             105,522   97,292
Inventory                                            227,542  213,590
Net property, plant and equipment                    111,284  113,037
Total assets                                         496,746  490,741
Accounts payable                                     110,586  119,815
Accrued liabilities                                   33,837   45,514
Revolving credit facility                             96,572   72,007
Other long-term debt (including current portion)     257,565  258,530
Total stockholder's deficit                          (45,189) (48,016)