Hello, everyone, and welcome to today's Commercial Metals Company First Quarter Fiscal 2012 Earnings Call. As always, today's call is being recorded. [Operator Instructions] I would like to remind all participants that during the course of this conference call, the company will make statements that provide information other than historical information and will included projections concerning the company's future prospects, revenues, expenses or profits. These statements are considered forward-looking statements and may involve speculation and are subject to risks and uncertainties that could cause actual results to differ materially from those -- from these projections. These statements reflect the company's beliefs based on current conditions, but are subject to certain risks and uncertainties that are detailed in the company's press release and public filings. When possible and as necessary during this call, we will identify those forward-looking statements, which are based on management's current expectations and other information that may be currently available. Some numbers presented will be non-GAAP financial measures and reconciliations can be found in the company's press release. Although CMC believes these statements are made based on management expectations and assumptions, CMC offers no assurance that events or facts will happen as described here or are wholly accurate without exception. More information about risks and uncertainties relating to any forward-looking statements can be found in CMC's latest 10-Q and 10-K available on both the company's and the SEC's websites. And all statements are valid only as of this date. CMC does not assume any obligation to update them as a description of future events, new information or otherwise. And now for opening remarks and introductions, I will turn the call over to the President and CEO of Commercial Metals Company, Mr. Joe Alvarado.

Thank you, and good morning, everyone. We appreciate you joining us to discuss CMC's first quarter fiscal 2012 results. I'll begin with some highlights on the first quarter and we'll provide an update on the progress we are making on a number of important initiatives we discussed with you last quarter. Barbara will then provide the financial details on the quarter and I will close with some comments on our outlook for the second quarter of fiscal 2012, at which time we will open up the call to questions. Before proceeding with our discussion on the quarter, as many of you know, Carl Icahn and its affiliated entities announced the intention to nominate 3 candidates for election to CMC's board and make certain other proposals at the company's annual meeting. In December, Mr. Icahn also launched a tender offer to acquire CMC. After a thorough review, our board made the unanimous recommendations that CMC shareholders reject Mr. Icahn's offer and not tender their shares as the board believes the offer is not in the interest of all CMC shareholders. There have been a number of communications stating our position, and full information is available in our public filings with the SEC. However, I would like to reiterate a few key points: First, our board believes Mr. Icahn's offer substantially undervalues CMC. It is opportunistically timed to a low point in the business cycle. Second, Mr. Icahn's offer has been made at a time when our new management, supported by a strong board that has also undergone significant change, is effectively executing our strategic plan. This plan is yielding positive results and creating momentum as evidenced by our financial performance. Finally, Mr. Icahn has put forth nominees who we believe are not qualified to serve and who will only further Mr.…

Thank you, Joe, and good morning, everyone. As Joe mentioned, for the first quarter 2012, we recorded net earnings of $107.7 million or $0.93 per share. Included in the results for the quarter was a tax benefit of $102 million or $0.87 per share related to ordinary worthless stock and bad debt deductions from the investment in the company's Croatian subsidiary. This tax benefit is forecasted to reduce income taxes payable for fiscal 2012 and future years. During the same period for 2011, we reported net earnings of just under $1 million or $0.01 per share and are therefore pleased with the increase in earnings of just over $107 million. Our discontinued operations, which consist primarily of the Croatian pipe mill, had a net loss of $17.3 million or $0.14 per share for this year's first quarter. On October 7, 2011, we announced our decision to exit the Croatian pipe mill business by closure of the facility and sale of the assets. This quarter's loss from discontinued operations includes approximately $18 million of severance costs related to the closure of the melt shop and pipe mill. Collectively, our U.S. steel mills generated an adjusted operating profit of $58.4 million for the quarter compared to $29.1 million during the same period last year. Net sales of $486 million were up 25% from last year's first quarter sales of $390 million. We recorded a pretax LIFO income of $900,000 compared to an expense of $10.5 million for the first quarter a year ago. Metal margins were higher at $322 per ton during the first quarter of 2011 when compared to the $314 per ton in the fourth quarter of 2011 and $293 per ton in the first quarter of 2011. Our copper tube mill reported an adjusted operating loss of $500,000 with…

Thank you, Barbara. In summary, we had a strong first quarter. We reported $107.7 million in net income; generated $38 million in cash from operations; declared our regular dividend for the 189th straight quarter; completed our plan to wind down operations in Croatia; completed our plan to adjust our fabricating cost structure with improved competitive and financial performance in this segment; commissioned 2 new shredders in December as a part of our strategy to grow this profitable segment; largely completed actions to reduce the operating cost structure, which will result in run rate savings of approximately $33 million per year; and amended our credit agreements to provide liquidity for the company to grow -- to continue to grow. With respect to our second quarter 2012 outlook, we currently anticipate that business activity will be similar to that which we experienced last quarter and most of 2011. Our second quarter is historically our slowest quarter due to weather-related slowdowns in construction and holiday seasons around the world. We do expect scrap prices to rise in the latter weeks of the second quarter, which should benefit our recycling operations, although our mills and fabrication operations could temporarily experience metal margin compression. We remain encouraged with the progress we are making in improving our operating cost structure and cash flows. The cost of discontinued operations should also be lower in the second quarter. Our backlog remains slightly higher than the last quarter and with improved prices. Accordingly, volumes should remain steady in the second quarter. We forecast the second quarter of 2012 to be another profitable quarter. We're pleased with our momentum and look forward to continuing to build on our progress in 2012 and beyond. Thank you for your attention. At this time, we will now open the call up to questions.

[Operator Instructions] And the first question today will come from Luke Folta of Jefferies. Luke Folta - Jefferies & Company, Inc., Research Division: Quick question on the backlogs. You had talked about some pricing improvement there and said that you'd seen some volume improvement as well. Just wanted to see if I could get some more color on how much improvement you've seen in regards to volumes and kind of what's your initial expectations in terms of calendar year 2012 that you think we could see as far as construction volume recovery.

Yes, the backlog volumes are only modestly greater than they were a quarter ago, so that's pointing to some steady business. I guess when we think about moving forward and looking ahead, our operating rates of about 78% -- 75% to 78% are well below where we'd like them to be, but we've demonstrated the ability to make money at that level. There is some strength in the market. I wish we could tell you concretely it's across-the-board. It's more isolated and regional, as we've talked about before. But there's a better sense in the market of construction activity being more related to commercial than the bigger, broader market of infrastructure spending. There still isn't much momentum for that. In fact, it's fading, but commercial activity seems to be offsetting it really to the same degree. And with a little bit of strength in the economy, the jobs figures that were reported this morning were encouraging, we could see an improvement in demand overall as the year builds. Luke Folta - Jefferies & Company, Inc., Research Division: Okay, and just a second question on your international trading operations. Do you think the losses that were incurred in response to the iron ore price movement, is that something that's going to carry into the February quarter?

No, we should -- if anything, we'll recover some of that into the February and well into the third and fourth quarter. The iron ore commitments are made over a longer period of time. And as it stands now, the loss that was incurred was primarily as a result of mark-to-market. On a mark-to-market basis now, we've recovered some of those losses. So we don't anticipate any huge hangover from that. But like any trading activity or distribution activity that we're engaged in, there are going to be periods where we haven't perfected. And over time, the iron ore business has been very good for us, but when prices fall 30%, it causes markets to jitter and we work with our customers and work with our vendors to get through that. This, unfortunately, was an unprecedented decline in prices in a very short period of time.

And our next question will come from Brent Thielman of D.A. Davidson. Brent Thielman - D.A. Davidson & Co., Research Division: Just on Fabrication, excluding some of the restructuring actions you've taken, did you see improvement in profitability for sort of the ongoing operations you have there?

Yes, when we talked about this before, Brent, we have to differentiate the segment by market. The central region is a good region for us. The central region really is the Texas and the 4-state area that surrounds us in Texas. Our eastern region is continuing to see some improvement, even in Florida, which is a market that had been pretty dormant for us. We talked about that market struggling. There is more construction activity, and again, a lot of it commercial. Where we struggle the most or where demand is most slack or prices are more competitive in the fab business remains the West Coast. Now, our Arizona mill is profitable and it's part of the West Coast region as we manage the business. That gets buried in our mill segment reporting, but it's a profitable business for us. But we're being forced to ship longer distances than was originally intended for that micromill and hence that's borne by the fab business and has a tendency to depress margins there. So we've seen margin improvement because of our prices or better cost coverage. So it's not just higher prices, but better margins in the fab segment that allow us to improve our results quarter-on-quarter. Brent Thielman - D.A. Davidson & Co., Research Division: Okay, that's helpful. And then on the Polish mill, could you quantify how much sort of maintenance costs and downtime impacted the quarter? And as a second part to that, can you just talk about kind of the backlog and level of activity you're seeing in Poland right now?

You know what, Brent, you've just asked a really good question and you've stumped us as I look around the room here. We'll have to get back to you on that figure. We had a couple outages, one in the mill and one in the melt shop.

Yes, and the outage probably was about $2.5 million of expense in the quarter. Brent Thielman - D.A. Davidson & Co., Research Division: And just sort of the level of activity you see in the backlog at the mill?

In Poland? Brent Thielman - D.A. Davidson & Co., Research Division: Yes.

The backlog is a strong backlog quarter-on-quarter. Compared to a year ago, a little bit different -- lighter than last year. But we maintain a good strong backlog here. The Northern European markets are different than Southern Europe. We haven't seen falloffs as reported in some of the Southern European markets. I think we're most closely aligned with Scandinavian and the German market, which remain strong. And Barbara and I were talking ahead of the call. This is a question that comes up repeatedly about Poland and I don't want to say it's an island unto itself, but it's a strong market with strong steel demand, growth in the industrial sector. And nothing is immune to market fluctuation, particularly when there's a lot of pressure on the euro. But for the most part, demand has remained strong, construction activity has remained strong and we're still projecting a good GDP growth in Poland.

And our next question will come from Brian Yu of Citigroup.

My question first is with the guidance. With regard to Recycling, you said that you expect higher scrap prices to benefit recycling operations second quarter. The fiscal 1Q results were already pretty good, actually a lot higher than what we've seen historically. Am I to imply to that statement that you actually expect results to get even better, improve sequentially in 2Q?

Right now what we're looking at is a pretty big spike in scrap prices as we see it today, and I'm talking about June. December was up and January is now up as well. In the range of -- I'm going to put a broad range on it, say, $25 to $35 a ton. It ranges by commodity pretty significantly. That's the second month in a row of a fairly significant bump, and we'll see some benefit from that in January as we did in December. But at the same time, we would expect that those prices would stabilize in February. I could be wrong. We've had projections that scrap prices would continue to escalate, but right now our view is that it would be more stable in February. So overall, the quarterly performance of Recycling should reflect those better prices and at least steady results quarter-on-quarter.

Okay. And you touched a bit on this before. With Fabrication, we're still seeing fairly steady volumes there despite the growth in backlog. When would you expect that backlog to translate to higher fabrication volumes? And is there any outlook you could provide on when that operation might begin to break even?

The fabrication volume -- you're talking specifically about fabrication and increased activity?

Yes.

That's kind of the question I tried to answer with the question from Brent. The markets remain oversupplied and there's plenty of fabricating capacity. So it's a very competitive business. But there really needs to be some sort of stimulus, whether it comes from government for infrastructure, which we're not counting on because there isn't funding, or whether it comes from the commercial sector. And as I tried to explain, the commercial sector seems have momentum of its own. In other words, their commercial projects are starting to move forward despite the lack of direction or positive influence from Washington on budgets or policy. And I think it may be as a reflection of pent-up demand, partly. Partly, it's a reflection of people moving ahead with projects because raw material prices have been fairly reasonable, and if you're going to proceed with a project that you have on the books, may as well go ahead with that project. So we've seen more commercial activity. But there isn't -- without strong demand on the commercial side and what I'll call the public infrastructure side, it's still going to be a very competitive market. And we're like others, projecting that 2012 will not be a breakout year. We've got some time to go before construction demand improves.

Okay, so you don't necessarily...

That answer your question, Brian?

Yes, I guess I was thinking we've been seeing your backlog grow over the last several quarters yet when we look at the fabrication shipment volumes, it's been at this 1 million ton per year or roughly 250,000 ton per quarter mark for quite some time. And I was kind of thinking, well, if backlog's improving, you should see a pickup in volumes there, too, and I'm just trying to figure out why there's a bit of a disconnect.

Well, you're probably not going to see it in our second quarter because of inclement weather starting to impact. Of course, it's less of an impact in our central region. So probably, you'll see a normal seasonal pickup in our third quarter. But as Joe said, for our planning purposes, we're still saying that 2011 will not -- or '12 won't be significantly better than 2011, especially as you move through the year and you move closer to the election, that could tend to create a little bit of uncertainty and pullback, waiting to see the outcome of the election. But eventually, it will flow through into our shipments.

And our next question will come from Sal Tharani of Goldman Sachs.

Barbara, can you break down your LIFO credit, which -- where will the major chunk of it go into? And also, on the guidance when you say better quarter on scrap, I'm just wondering are you looking at -- are you excluding the LIFO impact because as prices are going up, you might incur a LIFO charge next quarter?

Yes, for sure in the quarter, assuming prices drive, we're going to have to give back some of the LIFO benefit that we got in this quarter. But we're not expecting to give it all back. And if you look at the LIFO benefit in this current quarter, there was a little bit of a benefit in the mills, but most of it, it was sort of half-and-half between Recycling and Fab.

Okay, great. Just one question on Poland. The second quarter is generally the slowest quarter over there because of the weather. I was just wondering what prompted you to take the downtime in the first quarter versus the second quarter, which generally is much slower and you have less activity?

Sal, there are a couple of factors involved in that. We also have some scheduled outages in the second fiscal quarter that come over the holidays. We have the holidays and we're just trying to match the timing and availability of resources. We had an opening that we had planned for and just took advantage of it. We mentioned in our comments that we had some export orders as well. So overall, as we wind into seasonal adjustments in Poland, there are opportunities to do that kind of maintenance. So as opposed to thinking about it as when it's only slack and the weather is bad, there's some work that we do that has to be done ahead of that and helps us to lay it over a longer period of time. The objective, obviously, whether it's in Poland or whether it's in the U.S., is to get all that work done before our fiscal third quarter -- before the spring quarter because that's when we have to be ready to run. So how we spread it really becomes a function of resources availability and timing and spreading the work over a quarter because we have other work that's being done.

And our next question will come from Evan Kurtz of Morgan Stanley.

A question on Polish demand also. I know the Euro Cup is this summer. I was just wondering, do you have a sense from you downstream operations there how much of the surprising strength that you're talking about in demand in that part of the world is might be driven by the Euro Cup? And if not, what do you think is driving that and how susceptible is that to a downturn?

The Euro Cup was something that benefited us in prior quarters. Certainly, there was a lot of construction activity related to stadium and infrastructure and highway. Some of the highway work continues. In fact, the highway work is still pretty strong in the aggregate. But there are other segments of the economy that also remain strong. Housing in Poland as differentiated from multiunit housing in the United States, which is mostly wood construction-based is concrete and rebar-based or concrete and mesh-based in Poland. So there are others -- that's one segment that's pretty good is the housing market. Energy markets are good. Rail markets, a lot of rail infrastructure that's being built up. We don't anticipate a collapse because the overall projected demand for steel and continued strength in the Polish economy, we think, will offer us plenty of opportunities. At the same time, Evan, remember that a part of what we've talked about in Poland is having diversified our product offering. The investments that we've made allow us to sell more merchant products. So one of the reasons that the second quarter will be a better quarter for us than it might have been in prior years is because of increased value-added products, merchant and wire rod.

Got it, that's helpful. And then just one other question. Saw Turkish rebar import license spike up in December. Wondering what you're seeing on the ground as far as imports coming in the U.S. market at this point.

The Turks did this last year -- well, actually -- yes, it was last year officially in about February time frame. February, March was about 100,000 tons and then they dropped out of the market. And that probably was coincidental with some of what was going on in the Middle East and decline in activity and then the Turkish market, itself, picked up and reflected pretty strong demand from the Turkish economy. They're going to do this from time to time and that's kind of the way they operate. They'll move a lot of tons at one time and then withdraw from the market. The Mexican producers are little bit more consistent and certainly much more disciplined than dropping large quantities at one time. But we don't see that as being sustainable because the Turkish economy is pretty strong and the Middle East demand continues to grow. So they don't need to ship all the way to the United States to find a market when they have markets close to home.

And our next question will come from Aldo Mazzaferro of Macquarie.

A quick question on the iron ore side. Just quickly, I wonder if you could just tell us how big the mark-to-market charge was in the quarter. And then I also was wondering if you could just comment on some trends we've been seeing that the iron ore market in Asia seems to be getting a little tighter lately. I'm wondering if you're seeing that in your order books in the marketing and distribution side.

I wouldn't call it tight as much as I'd call it stable, Aldo. And at this time of year, going into the Chinese New Year, no one is going to build up stock. Chinese New Year is January 23rd and what's supposed to be a 1-week holiday turns into more like a 3-week holiday. So it's really February where we'll be seeing any changes in demand. There have been reports that prices are continuing to escalate, including export prices. So that reflects some cost pressure in China, I think, more than anything else. But being steady going into Chinese New Year is pretty good, and most are projecting that while there'll be no inventory build, there'll be no spike in pricing but some stability and we would expect the same. However, after Chinese New Year, it becomes a function of overall demand. And there haven't been stimulus programs in China as were anticipated. If any were to be introduced, that would be a positive. And obviously, ore pricing, without getting into details, is pretty much driven by what the big guys do, and the rest of us are supporting the market with whatever we can ship. As for the mark-to-market, we'd rather not get into details of contracts that we've engaged in.

I'm just wondering if that division was profitable before the charge or not. I guess, from your statement it says -- go ahead.

Yes, Aldo, I think the division would've generated profits consistent with what you've seen in recent quarters. And in fact, I think absent that, it would've been like their second best quarter in recent history. It was a really unfortunate situation where you had that 30% decline and the accounting requirements since we had firm purchase commitments at a set price, then we had to mark it down. And as Joe said earlier, we're working with our customers and we're confident that we'll sell that ore into the market in future periods and that we'll be able to recover back some of that. Maybe not all of it, but some of it.

Okay. And then I guess regarding the big gorilla in the room, I know you don't want to comment. But did Icahn's message that he would backstop the deal at 15 and let you guys put it up for sale, did that change your thinking at all on strategy?

Hey, Aldo, when you said the big gorilla in the room, I thought you were talking about me, and kind of embarrassed by that. We really don't want to comment in any of that, Aldo. So I'm sure you can appreciate that, that's why we opened with comments about the deal. And our board has been pretty clear in their view and we'll just leave it at that.

Our next question will come from Michael Gambardella of JPMorgan. Michael F. Gambardella - JP Morgan Chase & Co, Research Division: Non-res construction is clearly your biggest end market, especially here in the U.S., and it's been abysmal for a number of years now. One of the other companies I cover commented to me that their non-res construction-related business is operating today at around 30% of where it was in the '05 to '07 period. Do you have an order of magnitude for that number for commercial metals?

Well, I'll try -- we'll see if we can figure out the math here while we're talking. Most of our book used to be -- we'll call non-res commercial-related activity, about 70% of our book. Whether we look at it on a booking basis or on a shipment basis, it is going out the door. That went down to as low as 30% and it's recovered more to the 40 -- I'll call it 40% range of our business activity. So yes, it's off significantly and continues to be so. But there's been some strength. As I said, we were at 30%. It's more around the 40% range on average. That will vary region-to-region. It's certainly much stronger in the central region. Our western and eastern regions are still more predominantly dependent upon public monies and infrastructure work. Michael F. Gambardella - JP Morgan Chase & Co, Research Division: And in the central, what types of projects are you seeing?

Well, the central region is an interesting region because there's still oil money and so there are some projects that are related to energy companies and, I would call it, office complexes and related facilities. But there's also been a fair amount of other public projects. I'll use Dallas as an example. Parkland Hospital is being expanded, and it's a double expansion. The George Bush Library is another example. There's still good highway work in Northern Texas. Houston is not nearly as strong. It's a market that has potential for good recovery because energy producers have been making money and they do have strong demand. Exxon has some projects on the books that they haven't released or only partly for a huge complex in Houston in the Woodlands. That's the kind of stuff that as it frees itself up will create substantial demand throughout the state as opposed to just Northern Texas.

And our next question will come from Kuni Chen of CRT Capital Group.

Question on the Recycling business. So with the new shredders in place, does that basically drive your volumes up maybe 8% to 10% this year? How should we think about that? And then kind of in a longer-term context as we look out a year or 2 for Recycling, the volume level is still kind of 20% to 25% below peak levels that we saw back in the '08 time frame. What does it take to get back to that level? Is that really just competition for shredder feedstock or if you could just give me some detail there.

Okay, well, first off, we did have a shredder in Corpus Christi that was shut down and we've relocated. And so in some respects, that shredder, while it's a bigger shredder that we're installing, it isn't a significant change in shredder capacity. It's just a restart. And in Tulsa, while it's a new shredder, we've had yards up there and we've been collecting and moving product that we wouldn't be able to shred ourselves and moving it to other markets. It could have come to Dallas. It could have gone into export. There's river traffic that's associated with the Tulsa market. So we're moving it. So we're collecting it and not processing it. Processing it gives us better control, better scrap and better options not only for third-party sales but for our own consumption. So in many ways, it's just a complement to our existing. But as for making up the volume, the 25% to 30%, when our mills and everyone else's and our customers' mills are running harder and stronger is how that demand will recover. We're at 75%, 78% of capacity in that range and I venture to say our competitors and customers are operating in the same range, flat rolled a little bit differently as those operations are picking up. But for the most part, we need stronger demand overall for the mills to run at higher rates and for scrap consumption to increase. Meantime, export markets are attractive and have been for the last couple years.

Right, okay. And just as a quick follow-on, on the CapEx side, Barbara, can you maybe break down -- I think your range is $100 million plus for the year. Can you break down some of the big chunks that are in there?

You mean by project?

Yes, if there are any kind of 2 or 3 big projects.

Well, let me -- I guess I'll answer it this way. For modeling purposes, we're still suggesting that CapEx will probably be in excess of $100 million, maybe $130 million, $140 million for the year, probably see a little pick up of that in the second quarter. We're projecting slightly higher CapEx in the second quarter over the first quarter. It's really a variety of things throughout the system. Joe mentioned we had work going on in Poland. We have some projects in South Carolina coming up, in Alabama, the 2 shredders, that expense we'll be completing in this fiscal year. So there's not a big project like an Arizona or anything like that. It's normal refurbishment of furnaces and that type of thing.

And our next question will come from Chuck Bradford of Bradford Research.

Can you talk a little bit about your scrap business? What percentage of the scrap that you generated in the first quarter was used internally?

Chuck, about 40%, to be more precise, I don't have the exact number from first quarter. But on average, we're in the range of about 40%, 42% month -- quarter in, quarter out of what we process as ferrous gets consumed by our own facilities. The remainder of it goes to third-party sales.

And what percentage of your scrap needs were handled by your own yards? Or the melt shop needs?

It's about the same, Chuck. Off the top off the head, about the same. Yes, we buy a lot of third-party. We're doing same math everyone else does in trying to manage our costs. And where it makes more sense to ship metallics, we'll ship it. But if we can buy locally, we buy locally.

Our next question will come from Barry Vogel of Barry Vogel & Associates.

On the corporate and eliminations line, you had in your press release $29 million and I know that number fluctuates a lot. It seems like a high number compared to last year, which was $84 million. Can you explain why it was so high and what it might be for the year?

Yes, this quarter we had a big profit in inventory that flowed through eliminations. Of course, we'll recapture the later as that product flows through fab. We had an additional $4 million roughly in bonus accrual. And now, this year, we're anticipating hitting our plan and so we're, therefore, accruing at a target level whereas last year the accruals were very low. We have additional professional services, largely associated with our matter that Joe discussed at the beginning of the call and unfortunately, that's going to continue for some period of time. We did have some retirements and accelerated vesting of some options that we took in the quarter and we had some additional severance associated with some of the overhead reductions that we announced back in October.

Would you say that more than likely instead being near the $80 million, $85 million area, we're probably looking at $100 million plus this year for that line?

Barry, I didn't really look at what a good projection would be for that for the coming -- for this year. I can certainly take a closer look at that and talk to you off-line. But I think it'll be probably consistent with where it's been historically.

Okay, I will do that. And as far as depreciation and amortization, what's your best guess right now for this year?

Let me get the guys to give you a good number there because we need to pull out the Croatia effect and so it will be lower than it was last year. So I'll give that to you before the end of the call.

Okay, and then I got a couple of small items. There were 2 noncash charges in your press release, one was for an inventory write-down of $5.9 million. Can you tell us which segment that was in?

That was CSAC [ph]. That was the Croatian, just...

So that was part of the -- so would that be part of discontinued ops?

Yes.

Yes.

Okay, and the asset impairment charge, it was small, about $1 million, where was that?

That was also Croatia.

Okay, do you expect any further write-downs going forward given what you've gone through over the last couple of years?

I think, we -- no, we don't other than we'll have to await the outcome of the sale process and whether or not we'll be able to fully recover what we wrote those assets down to. And as you know, we had to do a fair market value analysis at the end of the year when we wrote them down and so assuming we can recapture that remaining amount, but we won't know until the sales conclude.

Our next question will come from Jeff Cramer of UBS.

You guys have obviously taken action in Croatia. I'm just wondering if there are any other international businesses under review either for growth, exit or otherwise.

We dealt with the Croatia situation and we added assets when we made the acquisition of G.A.M. in Australia. Most of our physical assets are either in Australia and/or Poland, and we have some mesh operations. And among the shutdowns of Fab business that we announced at the end of the year was a fab operation in Germany. So I don't anticipate any other asset write-downs. We took a long hard look at underperforming units, and that's how Croatia and some of the other rebar assets in North America and Germany were scrutinized. But I don't anticipate anything else. In Australia, we're still struggling with a more difficult economy there and we might want to consolidate some operations or -- certainly, we're going to continue to address our costs there. But I don't anticipate anything really significant in the way of asset write-downs or anything like that.

Okay, and then just the impact if any on the Marketing and Distribution business from being downgraded to high yield, I'm kind of thinking maybe in terms of collateral or otherwise? And also were the -- are the covenant requirements in your new credit facility the same as the previous facility as far as the tests?

The covenant requirements are the same. And with regard to your first question, obviously we're monitoring that carefully. But at this point, we haven't seen a significant impact to our largely uncommitted lines that we used primarily to fund the working capital needs for our Marketing and Distribution segments.

And our next question will come from Louis Sarkes of Chesapeake Partners.

Mine was really a follow-up in terms of if you could break out or give us some sort of estimate of the additional charges related to some of the bid matters that you saw or that you incurred during the quarter in SG&A line.

Oh, bid matters in SG&A.

Oh, okay. So I'm sorry, you're wanting finer detail or...

Yes, what was the aggregate amount that was spent on bid defense matters?

Oh okay, I'm sorry. For the current quarter, probably a couple million dollars all total. But that amount, we're probably going to see that grow.

Sure, okay.

This is an expensive process, whether we like it or not.

I just wanted just to get some ideas as to what was the incremental amount in SG&A.

Before we go to our next call, I just want to answer Barry's question for modeling purposes on depreciation and amortization, something in the $135 million to $140 million.

And our next question will come from -- a follow-up question from Sal Tharani of Goldman Sachs.

Joe, the 78% utilization rate you mentioned, can you break it down between the U.S. and Poland? And also how do you see the current quarter? I know it's going to be lower because of weather-related issues, but how far down you think you can go?

We've been hovering in the 70% range, 70% to 75%, so utilization at 78% was pretty good for us. We're looking up the difference in Polish versus U.S. I can tell you that our Polish operations were running at fairly high levels. I want to say above the average -- above the U.S. average, but I don't have that figure at my disposal. We'll get back to you on that one.

And our next question will come from Brian Yu from Citigroup.

Joe, back to that trading business, I have always thought that it was more agency type and you didn't have any capital at risk or taking on any inventory risk. Obviously, it's not the case. Could provide a breakout of what percentage of that trading is just purely agency and what percent is where you're taking on some inventory risk?

We nominally get involved in agency, that happens from time to time. But it's hard to hold business unless there's some stake involved whether on the buy or the sell side. So I would say our agency is de minimis. That's on the raw materials trading. And when we get into steel trading, it's a mix of both. But even there, what we try to do, Brian, is more back-to-back so that we're covered on our sales as opposed to taking positions. But in this case with the iron ore, we're in a long position because of the precipitous fall and then negotiations with customers, which concluded with having some exposure as the price was falling. So for the most part, if you're looking at at-risk capital, I guess the question or the issue for us is we try to cover our sales consistently, and for the most part do, but oftentimes there are some exposures that result. And in terms of carrying hard inventory -- excuse me, we do a little bit of that in tubular products in the States and in SBQ. But for the most part, our training activities are back-to-back and where we're involved in distribution, like in the U.K. as well as in Australia, well, we do take hard to inventory positions. That's part of the business of distribution management.

And at this time, showing no further questions in the queue, I will turn the conference back over to Mr. Alvarado for any closing comments.

We have one more answer to provide on the amortization.

No, I provided the depreciation and amortization, Sal, back to your question on Poland utilization. Their melt shop was pretty high, utilization at around 90% but rolling was 68%.

So that reflects the billet sales that we had. So why don't we go ahead and conclude? And I guess at this point, what I'd like to say is we appreciate your time and attention, and thank you for joining us on the conference call today. We look forward to meeting with many of our investors in the next coming weeks and can answer any questions that you might have as a result of this or other questions that pop into mind. And again, thank you very much for your time and attention. Goodbye.

Thank you. This concludes today's Commercial Metals Company Conference Call. You may now disconnect.