RESILIENT COMPANY

Tamara L. Lundgren, President and CEO

CEO Message

Just over a year ago, I signed Business Roundtable’s Statement on the Purpose of a Corporation, which has served as a guiding commitment for Schnitzer to create a lasting positive impact for our people, customers, suppliers, and communities, while continuing to deliver long-term value to our shareholders.

In fiscal 2020, this commitment was tested in ways we never could have imagined. Whether dealing with the effects of the COVID-19 pandemic, working to improve our struggling economy, or finding ways to address systemic racism, we’ve all grappled with how to make sense of our current state and how to move forward.

Schnitzer has operated continuously throughout the COVID-19 crisis. All of our operating facilities were identified as essential businesses, reflecting our Company’s vital role in supplying raw materials and finished steel products for construction of critical infrastructure. To ensure the safety of those who worked at or visited our sites, we deployed health, safety, and wellness protocols, rolled out training, and engaged in effective communications across our Company. While implementing these new work protocols, our team did not lose focus on operational safety. Our recordable incident rate in fiscal 2020 was the lowest and best rate recorded in our Company’s history and follows fiscal 2019, which was our previous best.

“There is no playbook for a year like this past one, but there certainly is a legacy at our Company of facing challenges head-on and successfully navigating through the toughest of times.”

Tamara L. Lundgren
Chairman, President, and CEO, Schnitzer

At the beginning of fiscal 2021, we completed the transition to our new “One Schnitzer” functionally-based and integrated operating model that we announced in April 2020. This is the culmination of our evolution to a more resilient and agile organization that will align with and further strengthen our sustainable business model—through which we transform salvaged material into inputs for new products. It will also improve our operational efficiency and enable greater focus on the critical drivers of our business, including innovative products and services that will help companies increase the sustainability of their own supply chains and reduce their carbon footprints.

Our One Schnitzer model is led by strong leaders and rising talent throughout all levels of our organization. And, we have a robust strategic plan centered around our sustainability framework of People, Planet, and Profit. Our People strategy includes three main focus areas: (i) continuing to improve our safety performance; (ii) strengthening our culture through increasing diversity and inclusion and expanding employee engagement; and (iii) giving back to the communities in which we operate through programs like our Volunteer Time Off (VTO) program.

Our Planet strategy is also centered on three critical areas: (i) progressing on our goals of reducing absolute greenhouse gas emissions from our recycling operations, (ii) increasing our use of carbon-free electricity; and (iii) continuing our investments in technologies that enable us to extract more recyclables from the material that we process that would otherwise be sent to landfills.

And, our Profit strategy is built upon three strategic pillars: (i) growing our volumes to leverage our existing processing capacity, (ii) expanding our margins through the successful deployment of advanced metal recovery technology, and (iii) developing new products and services to complement our core recycling and auto parts businesses.

Our operating and financial results in fiscal 2020 reflected the agility of our team, the strength of our culture, and the resiliency of our operating platform. We pivoted quickly to accommodate the changes needed for our Company to continue to operate safely and effectively in a volatile market. We kept our focus on optimizing our sales, aligning our operating costs with supply and production volumes, and moving ahead with our strategic investments.

There is no playbook for a year like this past one, but there certainly is a legacy at our Company of facing challenges head-on and successfully navigating through the toughest of times. Schnitzer and our stakeholders are meeting the challenges of our time because of several key strengths we have developed over the years. In our fiscal 2020 Sustainability Report, we share the importance of each of these strengths—not only for today, but also for the future.

In countries around the world, the long-term demand for ferrous and non-ferrous recycled metals is underpinned by several trends that are gaining increasing importance and relevance. Low-carbon economies are widely acknowledged as more metal-intensive economies. As countries transition to lower-carbon economies and as the number of electric arc furnace (EAF) steel mills operating in both the U.S. and Asia continue to grow, the need for metals, especially recycled metals, is expected to increase for many years to come.

Schnitzer is well-positioned to be a part of this more sustainable future, and we intend to continue to fulfill our commitment to support all our stakeholders.

Tamara L. Lundgren
Chairman and CEO, Schnitzer