SCHNITZER STEEL INDUSTRIES, INC. 43 / Schnitzer Steel Industries, Inc. Form 10-K 2017 Capital Expenditures Capital expenditures totaled $45 million, $35 million and $32 million for fiscal 2017, 2016 and 2015, respectively. Capital expenditures in each of these years were primarily to upgrade our equipment and infrastructure and for additional investments in environmental and safety-related projects. We currently plan to invest in the range of $55 million to $70 million in capital expenditures in fiscal 2018, an increase from the expenditures made in fiscal 2017 and 2016 primarily due to increased equipment replacement and upgrades, further investment in nonferrous processing technologies, and environmental projects using cash generated from operations and available credit facilities. Environmental Compliance Building on our commitment to recycling and operating our business in an environmentally responsible manner, we continue to invest in facilities that improve our environmental presence in the communities in which we operate. As part of our capital expenditures, we invested $17 million, $14 million and $10 million for environmental projects in fiscal 2017, 2016 and 2015, respectively. We plan to invest up to $20 million in capital expenditures for environmental projects in fiscal 2018. These projects include investments in storm water systems and equipment to ensure ongoing compliance with air quality and other environmental regulations. We have been identified by the United States Environmental Protection Agency (“EPA”) as one of the potentially responsible parties that own or operate or formerly owned or operated sites which are part of or adjacent to the Portland Harbor Superfund site (“the Site”). See Note 9 – Commitments and Contingencies in the Notes to the Consolidated Financial Statements in Part II, Item 8 of this report for a discussion of this matter. We believe it is not possible to reasonably estimate the amount or range of costs which we are likely to or which it is reasonably possible that we will incur in connection with the Site, although such costs could be material to our financial position, results of operations, cash flows and liquidity. We have insurance policies that we believe will provide reimbursement for costs we incur for defense, remediation and mitigation for natural resource damages claims in connection with the Site, although there are no assurances that those policies will cover all of the costs which we may incur. Significant cash outflows in the future related to the Site could reduce the amounts available for borrowing that could otherwise be used for working capital, capital expenditures, dividends, share repurchases, investments and acquisitions and could result in our failure to maintain compliance with certain covenants in our debt agreements, and could adversely impact our liquidity. Share Repurchase Program Pursuant to our amended share repurchase program, we have existing authorization to repurchase up to approximately 1.8 million shares of our Class Acommon stock when we deem such repurchases to be appropriate.We evaluate long- and short-range forecasts as well as anticipated sources and uses of cash before determining the course of action in our share repurchase program. As of the beginning of fiscal 2015, we had repurchased approximately 6.9 million shares of our Class A common stock under the program. We repurchased approximately 68 thousand shares for a total of $1 million and 203 thousand shares for a total of $3 million in open-market transactions in fiscal 2015 and 2016, respectively. We did not repurchase any shares in fiscal 2017. Assessment of Liquidity and Capital Resources Historically, our available cash resources, internally generated funds, credit facilities and equity offerings have financed our acquisitions, capital expenditures, working capital and other financing needs. We generally believe our current cash resources, internally generated funds, existing credit facilities and access to the capital markets will provide adequate short-termand long-term liquidity needs for working capital, capital expenditures, share repurchases, dividends, joint ventures, debt service requirements, environmental obligations, investments and acquisitions. However, in the event of a sustainedmarket deterioration, wemay need additional liquidity, whichwould require us to evaluate available alternatives and take appropriate steps to obtain sufficient additional funds. There can be no assurances that any such supplemental funding, if sought, could be obtained or, if obtained, would be adequate or on acceptable terms. Off-Balance Sheet Arrangements None requiring disclosure pursuant to Item 303 of Regulation S-K under the Securities Exchange Act of 1934.