|RELIANCE STEEL & ALUMINUM CO filed this Form 10-Q on 05/02/2019|
Net cash used in financing activities of $65.4 million in the first quarter of 2019 changed from $54.9 million net cash provided in the first quarter of 2018 mainly due to decreased net debt borrowings offset by decreased share repurchases. Net debt repayments in the first quarter of 2019 were $17.0 million compared to $145.3 million net debt borrowings in the first quarter of 2018. We spent $49.3 million to repurchase shares of our common stock in the first quarter of 2018.
On April 23, 2019, our Board of Directors declared the 2019 second quarter cash dividend of $0.55 per share. We have increased our quarterly dividend 26 times since our IPO in 1994, with the most recent increase of 10.0% from $0.50 per share to $0.55 per share effective in the first quarter of 2019. We have never reduced or suspended our dividend and have paid regular quarterly dividends to our stockholders for 60 consecutive years.
On October 23, 2018, our Board of Directors amended our share repurchase plan, increasing the total authorized number of shares available to be repurchased by 5.0 million and extending the duration of the plan through December 31, 2021. There were no share repurchases in the first quarter of 2019. As of March 31, 2019, we had authorization under the plan to repurchase approximately 7.0 million shares, or about 10% of our current outstanding shares. From the inception of the plan in 1994 through March 31, 2019, we have repurchased approximately 28.5 million shares at an average cost of $41.85 per share, including record share repurchases of approximately 6.1 million shares for a total of $484.9 million in 2018. We expect to continue to be opportunistic in our approach to repurchasing shares of our common stock.
Our primary sources of liquidity are funds generated from operations and our $1.5 billion revolving credit facility. Our total outstanding debt at March 31, 2019 was $2.20 billion, down slightly from $2.21 billion at December 31, 2018. As of March 31, 2019, we had $923.0 million of outstanding borrowings, $41.8 million of letters of credit issued, $535.2 million available for borrowing on our revolving credit facility and $133.6 million in cash and cash equivalents.
As of March 31, 2019, our net debt-to-total capital ratio (net debt-to-total capital is calculated as total debt, net of cash, divided by total Reliance stockholders’ equity plus total debt, net of cash) was 29.8%, down from 30.8% as of December 31, 2018.
On September 30, 2016, we entered into a $2.1 billion unsecured five-year credit agreement (“Credit Agreement”) comprised of a $1.5 billion unsecured revolving credit facility and a $600.0 million unsecured term loan, with an option to increase the revolving credit facility up to an additional $500.0 million at our request, subject to approval of the lenders and certain other customary conditions. We intend to use the revolving credit facility for working capital and general corporate purposes, including, but not limited to, capital expenditures, dividend payments, repayment of debt, share repurchases, internal growth initiatives and acquisitions. The $600.0 million term loan due September 30, 2021 amortizes in quarterly installments, with an annual amortization of 10% until June 2021, with the balance to be paid at maturity. All borrowings under the Credit Agreement may be prepaid without penalty.
Revolving credit facilities with a combined credit limit of approximately $10.1 million are in place for operations in Asia with combined outstanding balances of $4.8 million and $4.7 million as of March 31, 2019 and December 31, 2018, respectively.
On November 20, 2006, we entered into an indenture (the “2006 Indenture”) for the issuance of $600.0 million of unsecured debt securities. The total debt issued was comprised of two tranches, (a) $350.0 million aggregate principal amount of senior unsecured notes bearing interest at the rate of 6.20% per annum, which matured and were repaid on November 15, 2016 and (b) $250.0 million aggregate principal amount of senior unsecured notes bearing interest at the rate of 6.85% per annum, maturing on November 15, 2036.