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Financial research concept

Metals Service Center FIFO Gross Margin

measures gross margin before the period's LIFO inventory valuation adjustment, providing an ex-LIFO view of spread economics.

By Lee BaileyPublished Sep 30, 2026
Research context

See what supports this page, how current it is, and where comparable or historical context is available.

Research date
Sep 30, 2026Use the dated article and cited sources for the definition, examples, and stated limitations.
Operating-model context
10 connected conceptsPart of the reviewed Metals Service Center Economics; issuer definitions remain distinct where disclosed.
Company examples
2 reviewed companiesRelationships reflect supported examples, not a normalized cross-company KPI ranking.
  1. Ex-LIFO margin focuses on operating spread economics
  2. FIFO margin is non-GAAP for these issuers
  3. Part of the Metals Service Center Economics
  4. See It in Company Research
  5. Continue Research

Metals service center FIFO gross margin measures gross profit as a percentage of sales before the period's LIFO inventory valuation adjustment.

Reliance reported a 30.5% FIFO gross margin in the second quarter of 2026. Ryerson reported 18.6% gross margin excluding LIFO expense.

Ex-LIFO margin focuses on operating spread economics

Metals distributors buy inventory and resell it after varying holding periods. Rapid commodity-price changes can create large LIFO adjustments that obscure how selling prices compare with replacement-oriented material costs.

Removing that adjustment can make period-to-period operating comparisons easier, especially when average selling price per ton is moving quickly.

FIFO margin is non-GAAP for these issuers

Reliance explicitly uses FIFO gross profit measures to evaluate operating performance, while Ryerson presents gross margin excluding LIFO as a non-GAAP measure.

Keep the reconciliation to LIFO gross margin visible rather than treating the ex-LIFO figure as reported GAAP gross margin.

Primary sources: Reliance Q2 2026 Form 10-Q and Ryerson Q2 2026 Form 10-Q.

Part of the Metals Service Center Economics

Connects physical tonnage, price per ton, acquisition-adjusted volume, inventory-accounting effects, operating-cost intensity, processing depth, customer recurrence, and assortment breadth in metals distribution.

Browse the full operating model in Company Analysis →
Where this concept fits
  • Inventory accounting and gross-margin presentationCurrent relationship
    LIFO gross margin includes the period's inventory valuation adjustment, FIFO or ex-LIFO gross margin removes that effect, and the LIFO adjustment explains the accounting bridge between the two presentations.
    FIFO Gross MarginCurrent conceptLIFO Gross MarginLIFO Inventory Valuation Adjustment
  • Physical volume, price, and comparable demand
    Tons sold measures physical throughput, average selling price per ton captures commodity and mix effects, and same-store tons sold growth separates comparable-network demand from acquired volume.
    Average Selling Price per TonSame-Store Tons Sold GrowthTons Sold
  • Operating leverage and service depth
    SG&A expense per ton shows distribution-cost intensity, while value-added processing, repeat-order mix, and product breadth describe the service model that can support customer stickiness and margin resilience.
    Product CountRepeat Order MixSG&A Expense per TonValue-Added Processing Mix

See It in Company Research

These companies are examples of how the concept is reported or discussed in public filings. Definitions can differ by issuer; these links open company research rather than a normalized metric comparison.

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Compare ex-LIFO gross margins

Compare FIFO or ex-LIFO gross margin while preserving each issuer's non-GAAP reconciliation and inventory-cost methodology.

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