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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-Q

(Mark One)

For the quarterly period ended September 30, 2002

OR

For the transition period from __________ to __________

Commission file number: 001-13122

RELIANCE STEEL & ALUMINUM CO.
(Exact name of Registrant as specified in its charter)

350 South Grand Avenue, Suite 5100
Los Angeles, California 90071
(213) 687-7700
(Address of principal executive offices and telephone number)

     Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days.

Yes [X]    No [   ]

     As of October 31, 2002, 31,752,087 shares of the registrant’s common stock, no par value, were outstanding.

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RELIANCE STEEL & ALUMINUM CO.

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

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RELIANCE STEEL & ALUMINUM CO.

CONSOLIDATED BALANCE SHEETS

ASSETS

See accompanying notes to consolidated financial statements.

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RELIANCE STEEL & ALUMINUM CO.

UNAUDITED CONSOLIDATED STATEMENTS OF INCOME

See accompanying notes to consolidated financial statements.

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RELIANCE STEEL & ALUMINUM CO.

UNAUDITED CONSOLIDATED STATEMENTS OF INCOME

See accompanying notes to consolidated financial statements.

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RELIANCE STEEL & ALUMINUM CO.

UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS

See accompanying notes to consolidated financial statements.

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RELIANCE STEEL & ALUMINUM CO.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1. Basis of Presentation

The accompanying unaudited consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States for interim financial information and with the instructions of Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by accounting principles generally accepted in the United States for complete financial statements. In the opinion of management, all adjustments, consisting only of normal recurring adjustments, necessary for fair presentation, with respect to the interim financial statements have been included. The results of operations for the three and nine month periods ended September 30, 2002 are not necessarily indicative of the results for the full year ending December 31, 2002. For further information, refer to the consolidated financial statements and footnotes thereto for the year ended December 31, 2001, included in the Reliance Steel & Aluminum Co. Annual Report on Form 10-K. Certain reclassifications have been made to the 2001 balances to conform to the 2002 presentation.

2. Impact of Recently Issued Accounting Standards

In September 2001, the Financial Accounting Standards Board (“FASB”) issued Statement of Financial Accounting Standards (“SFAS”) No. 141, Business Combinations and SFAS No. 142, Goodwill and Other Intangible Assets. SFAS No. 141 is effective for any business combinations completed after June 30, 2001 and SFAS No. 142 is effective for fiscal years beginning after December 15, 2001. Under the new rules, goodwill deemed to have indefinite lives will no longer be amortized but will be subject to annual impairment tests in accordance with the Statements. Other intangible assets will continue to be amortized over their useful lives.

The Company has adopted the provisions of SFAS No. 141 for acquisitions completed subsequent to June 30, 2001 and has adopted SFAS No. 142 effective January 1, 2002. The Company has performed a transitional assessment of impairment of goodwill by applying fair-value-based tests and has determined that no impairment existed at January 1, 2002. The pro forma effect of these new accounting rules on net income and earnings per share for the three and nine months ended September 30, 2001 is as follows:

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RELIANCE STEEL & ALUMINUM CO.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)

3. Acquisitions

On September 9, 2002, the Company, through a newly-formed subsidiary, purchased, for $30 million, certain assets of a Metals USA, Inc. business, Metals USA Specialty Metals Northwest, Inc., after final approval of the U.S. Bankruptcy Court, in connection with Metals USA’s bankruptcy filing. The business is now operating under its original name, Pacific Metal Company. Pacific Metal Company has locations in Portland, Eugene and Medford, Oregon; Kent (Seattle) and Spokane, Washington; Billings, Montana; and Boise, Idaho and processes and distributes mainly aluminum and coated carbon steel products. Sales of Metals USA Specialty Metals Northwest, Inc. were $76 million for the year ended December 31, 2001. This acquisition broadens the Company’s product offerings and also provides entries into new geographic markets in Idaho and Montana. Pacific Metal Company operates as a wholly-owned subsidiary of the Company. This purchase was funded with borrowings under the Company’s line of credit. The purchase price allocation for this acquisition has not been finalized, pending the completion of valuations of real and personal property and intangibles.

On April 1, 2002, the Company, through a newly-formed subsidiary, purchased substantially all of the net assets and business of Central Plains Steel Co., a privately-held, full-line carbon steel service center, with facilities in Kansas City and Wichita, Kansas. Central Plains Steel Co. had sales of approximately $39 million for the year ended December 31, 2001, and now operates as a wholly-owned subsidiary of the Company under its former name, Central Plains Steel Co. This acquisition strengthens the Company’s market presence and complements its existing facilities in this area of its geographic network. This purchase was funded with borrowings under the Company’s line of credit. The purchase price allocation for this acquisition has not been finalized, pending the completion of valuations of personal property and intangibles.

Also on April 1, 2002, the Company acquired all of the outstanding stock of Olympic Metals, Inc., a privately-held metals service center in Denver, Colorado. Olympic specializes in the processing and distribution of aluminum, red metals and stainless steel products and had sales of approximately $8 million for the twelve months ended December 31, 2001. This acquisition strengthens the Company’s position and broadens its customer base in this area of its existing geographic network. Olympic operates as a wholly-owned subsidiary of the Company. This acquisition was funded with cash generated from operations.

These transactions have been accounted for under the purchase method of accounting. Accordingly, the accompanying consolidated statements of income include the revenues and expenses of each acquisition since its respective acquisition date. The consolidated financial statements reflect the preliminary allocations of the purchase price. The allocations of purchase price were based upon the preliminary estimation of fair values of the net assets purchased.

Effective May 1, 2002, the Operating Agreement of American Steel, L.L.C. (“American Steel”) was amended and one additional membership unit was issued to the Company, giving the Company 50.5% of the outstanding membership units. As part of the amendment, all super-majority and unanimous voting rights included in the Operating Agreement were eliminated, among other changes. Due to this change in ownership structure, the Company began consolidating American Steel’s financial results as of May 1, 2002. American Steel will continue to maintain a separate credit facility. The Company’s consolidated balance sheet at September 30, 2002 includes assets and liabilities of American Steel of $48 million and $32 million, respectively, including $25 million of goodwill and $20 million of debt. All significant inter-company transactions are eliminated in consolidation.

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RELIANCE STEEL & ALUMINUM CO.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)

4. Long-Term Debt

Long-term debt consists of the following:

The Company has a five-year syndicated credit agreement with nine banks for an unsecured revolving line of credit with a borrowing limit of $335 million which may be increased to $400 million. The Company has $280 million of outstanding senior unsecured notes issued in private placements of debt. The outstanding senior notes bear interest at an average fixed rate of 6.83% and have an average life of 5.0 years, maturing from 2004 to 2010. American Steel has a two-year syndicated credit agreement, as amended effective June 30, 2002, that is secured by its working capital with a borrowing limit of $24 million.

The Company’s long-term loan agreements require the Company to maintain a minimum net worth and include certain restrictions on the amount of cash dividends that the Company may pay, among other things. The syndicated credit facility includes a commitment fee on the unused portion, currently at an annual rate of 0.25%.

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RELIANCE STEEL & ALUMINUM CO.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)

5. Shareholders’ Equity

In March 2002, 8,334 shares of common stock were issued to division managers and certain officers of the Company under the Key-Man Incentive Plan for 2001.

Accumulated other comprehensive loss of $0.9 million at September 30, 2002 consists of $0.4 million ($0.2 million net of tax) related to unrealized losses on retirement plan investments and $0.5 million ($0.3 million net of tax) related to foreign currency translation adjustments. Accumulated other comprehensive loss of $1.0 million ($0.6 million net of tax) at December 31, 2001, respectively, consists of foreign currency translation adjustments.

6. Earnings Per Share

The Company calculates basic and diluted earnings per share as required by SFAS No. 128, Earnings Per Share. Basic earnings per share exclude any dilutive effects of options, warrants and convertible securities. Diluted earnings per share is calculated including the dilutive effects of warrants, options, and convertible securities, if any. The following table sets forth the computation of basic and diluted earnings per share:

The computations of earnings per share for the three months ended September 30, 2002 and 2001 do not include 604,750 shares and 37,500 shares reserved for issuance upon exercise of stock options, respectively, because their inclusion would have been anti-dilutive due to fluctuations of the average market price. There were no anti-dilutive shares reserved for issuance upon exercise of stock options for the nine months ended September 30, 2002 or 2001.

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RELIANCE STEEL & ALUMINUM CO.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following table sets forth certain income statement data for each of the periods indicated (dollars are shown in thousands and certain amounts may not calculate due to rounding):

2002 Acquisitions

On September 9, 2002, through a newly-formed company, we purchased certain assets of a Metals USA, Inc. business, Metals USA Specialty Metals Northwest, Inc., for $30 million, after final approval of the U.S. Bankruptcy Court, in connection with Metals USA’s bankruptcy filing. The business is now operating under its original name, Pacific Metal Company. Pacific Metal Company has locations in Portland, Eugene and Medford, Oregon; Kent (Seattle) and Spokane, Washington; Billings, Montana; and Boise, Idaho and processes and distributes mainly aluminum and coated carbon steel products. Sales of this business were $76 million for the year ended December 31, 2001. This purchase was funded with borrowings under our line of credit.

On April 1, 2002, we purchased substantially all of the net assets and business of Central Plains Steel Co. through a newly-formed subsidiary that is now operating under the same name. Central Plains Steel Co., a full-line carbon steel service center with facilities in Kansas City and Wichita, Kansas, had sales of approximately $39 million for the year ended December 31, 2001. This purchase was funded with borrowings under our line of credit.

Also on April 1, 2002, we acquired all of the outstanding stock of Olympic Metals, Inc., a metals service center in Denver, Colorado. Olympic Metals, Inc. specializes in the processing and distribution of aluminum, red metals and stainless steel products and had sales of approximately $8 million for the twelve months ended December 31, 2001. We funded this acquisition with cash generated from operations.

Effective May 1, 2002, we obtained one additional membership unit of American Steel, L.L.C. (“American Steel”) giving us a 50.5% ownership interest. The Operating Agreement was amended to eliminate all super-majority and unanimous voting rights, among other changes. Due to this change in ownership structure, we began consolidating American Steel’s financial results as of May 1, 2002. There was no cost involved in this transaction, which was completed to facilitate the renewal of American Steel’s credit facility. American Steel had sales of $72 million for the twelve months ended December 31, 2001.

For discussion purposes, all references to the Company’s 2002 acquisitions include the consolidation of American Steel as of May 1, 2002.

2001 Acquisitions

On July 2, 2001, we purchased the net assets of the steel service centers division of Pitt-Des Moines, Inc., through our newly-formed subsidiary, PDM Steel Service Centers, Inc. (“PDM”). PDM processes and distributes carbon steel products consisting primarily of structurals and plate for the capital goods and construction industries and had net sales of approximately $86 million for the six months ended December 31, 2001. PDM operates six metals service center facilities in Fresno, Santa Clara and Stockton (headquarters), California; Sparks, Nevada; Spanish Fork, Utah; and Woodlands, Washington. This acquisition included a seventh metals service

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center facility in Cedar Rapids, Iowa that became a division of our subsidiary Liebovich Bros., Inc. (headquartered in Rockford, IL) on April 1, 2002.

Effective January 19, 2001, we acquired 100% of the outstanding stock of Aluminum and Stainless, Inc., that operates a metals service center based in Lafayette, Louisiana. Aluminum and Stainless provides non-ferrous products primarily related to the marine industry for use in the production of large commercial vessels that provide various services for offshore oil rigs. In March 2001, we opened a branch operation of Aluminum and Stainless in New Orleans, Louisiana, through the purchase of certain assets of an existing metals service center. Aluminum and Stainless had net sales of approximately $30 million for the period January 20, 2001 to December 31, 2001, including the sales of the New Orleans branch.

Effective January 18, 2001, we purchased 100% of the stock of Viking Materials, Inc., based in Minneapolis, Minnesota, and a related company, Viking Materials of Illinois, Inc., based near Chicago, Illinois. These service centers provide primarily carbon steel flat-rolled products to their customers in the Midwest region of the United States and had consolidated revenues of approximately $68 million for the period January 19, 2001 to December 31, 2001. Viking Materials of Illinois, Inc. has been merged into Viking Materials, Inc. and now operates as a division of that company.

Three Months Ended September 30, 2002 Compared to Three Months Ended September 30, 2001

In the three months ended September 30, 2002, our consolidated net sales increased 5.8% to $454.8 million, compared to the same period of 2001. This includes an increase of 4.6% in tons sold and an increase in the average selling price per ton of 2.1%. The increase in tons sold was primarily due to the sales generated by the companies we acquired in 2002 and 2001. The increase in our average selling price per ton of 2.1% resulted mainly from the increased carbon steel pricing that has occurred in 2002 due to supply constraints. These increases were reflected in our selling prices in the third quarter of 2002.

Same-store sales (excluding sales generated by the companies we acquired since the beginning of 2001) were $359.2 million, relatively flat with the 2001 third quarter sales of $358.6 million, with a 2.7% decrease in tons sold and a 2.9% increase in the average selling price per ton. The decrease in same-store tons sold resulted from the continued general downturn in the economy, especially related to the aerospace industry. Our sales to the aerospace industry decreased 25.5% in the 2002 third quarter as compared to the 2001 third quarter, with a 19.5% decrease in tons sold and a 7.6% decrease in the average selling price.

Total gross profit increased 6.0% to $125.5 million for the third quarter of 2002 compared to $118.4 million in the third quarter of 2001. As a percentage of sales, gross profit was 27.6% in the three months ended September 30, 2002, comparable to 27.5% in the three months ended September 30, 2001. We did experience slight margin pressure in the third quarter of 2002 as compared to the second quarter of 2002 when our gross margin percentage was 28.0%. This was due to the significant increase in the costs of certain carbon steel products, primarily flat-rolled; however, we were successful in passing on most of the increase to our customers.

Warehouse, delivery, selling, general and administrative (“S,G&A”) expenses increased $4.8 million, or 5.2%, in the third quarter of 2002 compared to the corresponding period of 2001, and amounted to 21.2% of sales in the 2002 third quarter and 21.3% of sales in the 2001 third quarter. The dollar increase in S,G&A expenses includes the expenses of the businesses we acquired after the third quarter of 2001. On a same-store basis, we reduced our S,G&A expenses by $2.4 million in the three months ended September 30, 2002 compared to the same period of 2001.

Depreciation and amortization expense decreased $1.1 million, or 12.7%, during the three months ended September 30, 2002, compared to the corresponding period of 2001. This decrease is primarily due to the change in accounting rules for the amortization of goodwill that were effective for us on January 1, 2002. The third quarter of 2001 included $1.9 million, or $.04 per diluted share, of goodwill amortization expense compared to none in the third quarter of 2002. The decrease in amortization expense was offset by an increase in depreciation expense from our 2002 acquisitions.

Interest expense decreased by 6.0% to $5.7 million in the 2002 third quarter compared to $6.1 million in the 2001 third quarter, due to both lower borrowing levels and lower interest rates.

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Because of our increased ownership in American Steel, and the elimination of all super-majority and unanimous voting rights included in the Operating Agreement, we began to consolidate its results beginning May 1, 2002 rather than account for our investment on the equity method. On our income statement, the 2002 equity in earnings of 50%-owned company represents our 50% of American Steel’s net income from January 1 through April 30. The minority interest amount represents 49.5% of American Steel’s net loss, beginning May 1, 2002 for the portion we do not own. Our consolidated balance sheet at September 30, 2002 includes assets and liabilities of American Steel of $47.6 million and $32.3 million, respectively, including $24.5 million of goodwill and $19.7 million of debt. The minority interest liability on our balance sheet includes the 49.5% of American Steel that we do not own.

Our effective income tax rate decreased to 39.6% for the 2002 third quarter, compared to 40.6% for the 2001 third quarter, primarily due to shifts in our geographic composition which favorably affected the state tax rate.

Nine Months Ended September 30, 2002 Compared to Nine Months Ended September 30, 2001

Consolidated net sales were $1.31 billion for the nine months ended September 30, 2002, an increase of 2.8% from the nine months ended September 30, 2001. The 2002 nine-month sales represent an increase of 12.4% in tons sold and a decrease in the average selling price per ton of 8.4%. The increase in our tons sold was primarily due to the sales of the companies we acquired in 2002 and 2001. The decrease in our average selling price per ton of 8.4% resulted because the selling prices, and costs, for most of our products began to decline in September 2001 and continued downward through the first half of 2002. The costs of most of our products were stable in the third quarter of 2002 except for increased costs of certain carbon steel products. Our selling price also decreased because of a shift in product mix, with an increase of 6.4% in carbon steel product sales during the nine months ended September 30, 2002 as compared to the nine months ended September 30, 2001. Our carbon steel products generally have lower prices than most other products we sell. This shift was mainly due to our acquisitions and the consolidation of American Steel, but was also impacted by the decreased sales of aluminum and stainless steel products to the semiconductor, electronics and aerospace industries during the 2002 periods as compared to the 2001 periods.

Our same-store sales decreased $101.0 million, or 8.7%, in the 2002 nine-month period. Same-store tons sold decreased by 3.8% and our average selling price per ton decreased 5.0% due to the continued general downturn in the economy, especially in the aerospace industry. Our sales to the aerospace industry decreased 27.5% in the nine months ended September 30, 2002 as compared to the same period in 2001, with a 21.1% decrease in tons sold and an 8.2% decrease in the average selling price.

Total gross profit was $363.1 million for the first nine months of 2002, a 2.7% increase, compared to $353.5 million in the first nine months of 2001. The increased gross margin resulted from the sales of the companies we acquired in 2002 and 2001. As a percentage of sales, gross profit was consistent at 27.7% for the nine months ended September 30, 2002 and 2001.

S,G&A expenses for the nine months ended September 30, 2002 increased $21.6 million, or 8.4%, compared to the corresponding period of 2001, mainly because we included the S,G&A expenses of the businesses we acquired in 2002 and 2001. S,G&A expenses were 21.4% as a percent of sales for the nine-month period of 2002, up from 20.3% for the same nine-month period of 2001. The increase as a percent of sales was because of the lower average sales prices for our products during 2002. On a same-store basis, S,G&A expense decreased $8.0 million, or 3.3%, for the 2002 nine-month period compared to the 2001 period. The majority of the same-store expense decrease resulted from headcount reductions, as we reduced our workforce by approximately 6.4% during the twelve months ended September 30, 2002.

Depreciation and amortization expense decreased $2.6 million during the nine months ended September 30, 2002, compared to the corresponding period of 2001. This decrease is due to the change in accounting rules for the amortization of goodwill that were effective for us on January 1, 2002. The first nine months of 2001 included $5.4 million, or $.12 per diluted share, of goodwill amortization expense compared to none for the 2002 nine-month period. The decrease in amortization expense was offset by an increase in depreciation expense due to our 2001 and 2002 acquisitions.

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Interest expense decreased by 20.1% to $16.8 million in the first nine months of 2002 compared to $21.0 million in the 2001 period, due to both lower borrowing levels and lower interest rates. We applied the $149.8 million of net proceeds from our equity offering in July 2001 to pay down debt. Our 2002 interest expense includes interest on debt to fund our 2002 acquisitions and debt from American Steel.

Our effective income tax rate was 39.6% for the first nine months of 2002, comparable to 39.4% for the first nine months of 2001.

Liquidity and Capital Resources

At September 30, 2002, working capital amounted to $399.3 million compared to $380.0 million at December 31, 2001. The increase was due to companies we acquired in 2002 and due to changes in our working capital due to improved sales levels in the third quarter of 2002 compared to the fourth quarter of 2001. Excluding the effect of these acquisitions, our accounts receivable increased $26.8 million, our inventory decreased by $16.7 million, and our accounts payable increased by $33.0 million. Our capital requirements are primarily for working capital, acquisitions, and capital expenditures for continued improvements in plant capacities and materials handling and processing equipment.

Our primary sources of liquidity are generally from internally generated funds from operations and our revolving line of credit. In 2001, we also raised net proceeds of $149.8 million in a secondary equity offering. These funds were used to pay down debt. Operations provided cash of $70.9 million in the nine months ended September 30, 2002, as compared to $79.7 million of cash during the corresponding period of 2001. Our net income and working capital changes discussed above generated the cash flow from operations. We used the cash provided by our 2002 operations to pay down debt including debt incurred to fund our 2002 acquisitions. At September 30, 2002 our net debt-to-total capital ratio was 36.4% compared to 37.7% at September 30, 2001.

Our syndicated credit facility has a borrowing limit of $335.0 million, which can be increased to $400.0 million. At September 30, 2002, $54.0 million was outstanding under this credit facility. American Steel’s syndicated credit facility, as amended effective June 30, 2002, has a borrowing limit of $24.0 million. At September 30, 2002, $19.7 million was outstanding under this credit facility. We also have senior unsecured notes outstanding in the aggregate amount of $280.0 million. During the first quarter of 2002, we paid off a $10.0 million note upon its maturity. The senior notes have maturity dates ranging from 2004 to 2010, with an average life of 5.0 years. The senior notes bear interest at an average fixed rate of 6.83% per annum.

Our capital expenditures, excluding acquisitions, were $12.4 million for the nine months ended September 30, 2002. We had no material commitments for capital expenditures as of September 30, 2002. We anticipate that funds generated from our operations and funds available under our line of credit will be sufficient to meet our working capital needs for the foreseeable future.

Seasonality

Some of our customers are in seasonal businesses, especially customers in the construction industry. As a result of our geographic, product and customer diversity, however, our operations have not shown any material seasonal trends. Revenues in the months of November and December traditionally have been lower than in other months because of a reduced number of working days for shipments of our products and holiday closures for some of our customers. We cannot assure you that period-to-period fluctuations will not occur in the future. Results of any one or more quarters are therefore not necessarily indicative of annual results.

Goodwill

Goodwill, which represents the excess of cost over the fair value of net assets acquired, amounted to $291.2 million at September 30, 2002, or approximately 24.7% of total assets or 47.7% of consolidated shareholders’ equity.

In June 2001, the FASB issued SFAS No. 141, Business Combinations and SFAS No. 142, Goodwill and Other Intangible Assets. Under the new rules, goodwill deemed to have indefinite lives is no longer amortized, but is subject to annual impairment tests in accordance with the Statements. Other intangible assets will continue to be amortized over their useful lives. We have adopted the provisions of SFAS No. 141 for acquisitions completed subsequent to June 30, 2001 and have adopted SFAS No. 142 effective January 1, 2002.

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Pursuant to SFAS No. 142, we have performed a transitional assessment of impairment of goodwill by applying fair-value-based tests to our identified operating segments and have determined that no impairment of goodwill existed at January 1, 2002.

Critical Accounting Policies

Management’s Discussion and Analysis of Financial Condition and Results of Operations discusses our unaudited Consolidated Financial Statements, which have been prepared in accordance with accounting principles generally accepted in the United States. When we prepare these financial statements, we are required to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. On an on-going basis, we evaluate our estimates and judgments, including those related to accounts receivable, inventories, deferred tax assets, equity investment, goodwill and intangible assets, and revenue recognition. We base our estimates and judgments on historical experience and on various other factors that we believe to be reasonable under the circumstances, the results of which form the basis for our judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.

For further information regarding the accounting policies that we believe to be critical accounting policies and that affect our more significant judgments and estimates used in preparing our consolidated financial statements see our December 31, 2001 Form 10-K.

Market Risk

In the ordinary course of business, we are exposed to various market risk factors, including changes in general economic conditions, domestic and foreign competition, foreign currency exchange rates, and metal pricing and availability. Additionally, we are exposed to market risk primarily related to our fixed rate long-term debt. Market risk is the potential loss arising from adverse changes in market rates and prices, such as interest rates. Decreases in interest rates may affect our market value of fixed rate debt. Under our current policies, we do not use interest rate derivative instruments to manage exposure to interest rate changes. Based on our debt, we do not consider the exposure to interest rate risk to be material. Our fixed rate debt obligations are not callable until maturity.

Controls and Procedures

Within the 90 days prior to the date of this report, the Company carried out an evaluation, under the supervision and with the participation of the Company’s management, including the Company’s Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of the Company’s disclosure controls and procedures pursuant to Rule 13a-14 under the Securities Act of 1934, as amended. Based upon that evaluation, the Chief Executive Officer and Chief Financial Officer concluded that the Company’s disclosure controls and procedures are effective in timely alerting them to material information relating to the Company required to be included in the Company’s periodic SEC filings.

There have been no significant changes in the Company’s internal controls or in other factors which could significantly affect internal controls subsequent to the date the Company carried out its evaluation.

This Form 10-Q may contain forward-looking statements relating to future financial results. Actual results may differ materially as a result of factors over which Reliance Steel & Aluminum Co. has no control. These risk factors and additional information are included in the Company’s Annual Report on Form 10-K and the Company’s Prospectus dated June 28, 2001 filed under Rule 424(b).

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PART II — OTHER INFORMATION

Item 1. Legal Proceedings.

     Not applicable.

Item 2. Changes in Securities.

	(a)		Not applicable.
	(b)		Not applicable.
	(c)		Not applicable.
	(d)		Not applicable.

Item 3. Defaults Upon Senior Securities.

	(a)		Not applicable.
	(b)		Not applicable.

Item 4. Submission of Matters to a Vote of Security Holders.

     Not applicable.

Item 5. Other Information.

     Not applicable.

Item 6. Exhibits and Reports on Form 8-K.

     (a)  Exhibits:

	99.2     Certification Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

     (b)  Reports on Form 8-K:

	The Company filed a Report on Form 8-K dated August 9, 2002, disclosing the signed statements under oath of the Principal Executive Officer and Principal Financial Officer regarding facts and circumstances related to Exchange Act filings.

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SIGNATURES

     Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

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Certification of Principal Executive Officer
Pursuant to Rule 13a-14 of the Securities Exchange Act of 1934

I, David H. Hannah, hereby certify that:

1.		I have reviewed this quarterly report on Form 10-Q of Reliance Steel & Aluminum Co., a California corporation (the “Company”), for the quarterly period ended September 30, 2002;
2.		Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report;
3.		Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this quarterly report;
4.		The registrant’s other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:

	(a)		designed such disclosure controls and procedures to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this quarterly report is being prepared;
	(b)		evaluated the effectiveness of the registrant’s disclosure controls and procedures as of a date within 90 days prior to the filing of this quarterly report (the “Evaluation Date”); and
	(c)		presented in this quarterly report the undersigned’s conclusions about the effectiveness of the disclosure controls and procedures based on our required evaluation as of the Evaluation Date;

5.

The registrant’s other certifying officers and I have disclosed, based on our most recent evaluation, to the registrant’s auditors and to the audit committee of the registrant’s board of directors (or persons performing the equivalent function):

	(a)		all significant deficiencies in the design or operation of internal controls which could adversely affect the registrant’s ability to record, process, summarize and report financial data and have identified for the registrant’s auditors any material weaknesses in internal controls; and
	(b)		any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal controls.

6.

The registrant’s other certifying officers and I have indicated in this quarterly report whether or not there were significant changes in internal controls or in other factors that could significantly affect internal controls subsequent to the date of our most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses.

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Certification of Principal Financial Officer
Pursuant to Rule 13a-14 of the Securities Exchange Act of 1934

I, Karla McDowell, hereby certify that:

1.		I have reviewed this quarterly report on Form 10-Q of Reliance Steel & Aluminum Co., a California corporation (the “Company”), for the quarterly period ended September 30, 2002;
2.		Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report;
3.		Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this quarterly report;
4.		The registrant’s other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:

	(a)		designed such disclosure controls and procedures to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this quarterly report is being prepared;
	(b)		evaluated the effectiveness of the registrant’s disclosure controls and procedures as of a date within 90 days prior to the filing of this quarterly report (the “Evaluation Date”); and
	(c)		presented in this quarterly report the undersigned’s conclusions about the effectiveness of the disclosure controls and procedures based on our required evaluation as of the Evaluation Date;

5.

The registrant’s other certifying officers and I have disclosed, based on our most recent evaluation, to the registrant’s auditors and to the audit committee of the registrant’s board of directors (or persons performing the equivalent function):

	(a)		all significant deficiencies in the design or operation of internal controls which could adversely affect the registrant’s ability to record, process, summarize and report financial data and have identified for the registrant’s auditors any material weaknesses in internal controls; and
	(b)		any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal controls.

6.

The registrant’s other certifying officers and I have indicated in this quarterly report whether or not there were significant changes in internal controls or in other factors that could significantly affect internal controls subsequent to the date of our most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses.

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