CHARLOTTE, N.C., Dec. 15, 2016 /PRNewswire/ -- Nucor
Corporation (NYSE: NUE) announced today guidance for its fourth
quarter ending December 31, 2016.
Nucor expects fourth quarter results to be in the range of
$0.30 to $0.35 per diluted
share. This range is a decrease compared to the third quarter
of 2016 consolidated net earnings of $0.84 per diluted share and a decrease compared
to the fourth quarter of 2015 adjusted net earnings of $0.45 per diluted share. Fourth quarter of 2015
adjusted net earnings excludes $0.64
of impairment charges recorded during the quarter. Including these
impairment charges, Nucor's net loss for the fourth quarter of 2015
was $0.19 per diluted share.
Projected fourth quarter of 2016 results include an estimated
LIFO expense of $35.3 million
($0.07 per diluted share), compared
to an expense of $59.3 million
($0.12 per diluted share) in the
third quarter of 2016 and a credit of $217.8
million ($0.41 per diluted
share) in the fourth quarter of 2015. Included in the third quarter
of 2016 results were charges related to legal settlements of
$33.7 million ($0.06 per diluted share) and a net benefit of
$11.1 million ($0.02 per diluted share) related to fair value
adjustments to assets in the corporate/eliminations segment. The
impairment charges recorded in the fourth quarter of 2015 noted
above were made up of a $153.0
million ($0.47 per diluted
share) impairment charge related to our Duferdofin Nucor S.r.l.
joint venture and an $84.1 million
($0.17 per diluted share) impairment
charge on assets related to a blast furnace project that will not
be utilized in the future.
Trade cases initiated by the U.S. steel industry targeting
several product groups are having a positive impact as steel
imports are down approximately 19% this year compared to last year.
Affirmative final determinations announced earlier this year in
cases involving three flat-rolled products - corrosion-resistant,
cold-rolled and hot-rolled steel - are an important step in
returning fair trade to the U.S. flat-rolled steel market. In
addition, the U.S. Department of Commerce recently released
preliminary duty determinations in investigations addressing
cut-to-length plate from twelve countries. The U.S. Department of
Commerce also announced the initiation of antidumping duty
investigations of imports of steel concrete reinforcing bar from
Japan, Taiwan, and Turkey, and a countervailing duty
investigation of steel concrete reinforcing bar imports from
Turkey. We expect the plate and
rebar cases to conclude in 2017.
The expected decline in earnings in the fourth quarter of 2016
compared to the third quarter of 2016 is primarily due to lower
margins in the steel mills segment, with the most significant
impact at our sheet mills. The performance of the raw materials
segment in the fourth quarter of 2016 will decline significantly
compared to the third quarter of 2016 as it returns to a loss
position due to lower pricing at our DRI facilities in the fourth
quarter. We expect decreased profitability for our steel products
segment in the fourth quarter of 2016 as compared to the third
quarter of 2016 due to end of year seasonality that is typical in
the fourth quarter.
Market conditions for the steel mills segment have been marked
by volatility in sales prices and demand during 2016. Looking ahead
to 2017, we are optimistic about continued improvement in market
conditions. Prices have increased throughout the fourth quarter for
our sheet, bar, structural and plate mills. Scrap and other
commodities prices have been increasing as we approach the end of
the year. Service center inventory levels remain low. We believe
higher input costs and declining imports are now causing the market
to find an improved and more sustainable level that we expect to
benefit 2017.
Nucor and its affiliates are manufacturers of steel
products, with operating facilities primarily in the U.S. and
Canada. Products produced include: carbon and alloy steel --
in bars, beams, sheet and plate; hollow structural section tubing;
steel piling; steel joists and joist girders; steel deck;
fabricated concrete reinforcing steel; cold finished steel; steel
fasteners; metal building systems; steel grating; and wire and wire
mesh. Nucor, through The David J. Joseph Company,
also brokers ferrous and nonferrous metals, pig iron and HBI/DRI;
supplies ferro-alloys; and processes ferrous and nonferrous
scrap. Nucor is North America's largest
recycler.
Certain statements contained in this news release are
"forward-looking statements" that involve risks and
uncertainties. The words "believe," "expect," "project,"
"will," "should," "could" and similar expressions are intended to
identify those forward-looking statements. Factors that might
cause the Company's actual results to differ materially from those
anticipated in forward-looking statements include, but are not
limited to: (1) competitive pressure on sales and pricing,
including competition from imports and substitute materials; (2)
the sensitivity of the results of our operations to prevailing
steel prices and the changes in the supply and cost of raw
materials, including scrap steel; (3) market demand for steel
products; and (4) energy costs and availability. These and
other factors are discussed in Nucor's regulatory filings with
the Securities and Exchange Commission, including those
in Nucor's fiscal 2015 Annual Report on Form 10-K, Item
1A. Risk Factors. The forward-looking statements contained in
this news release speak only as of this date, and Nucor does
not assume any obligation to update them.
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SOURCE Nucor Corporation