FORT WAYNE, Ind., March 16, 2017 /PRNewswire/ -- Steel Dynamics,
Inc. (NASDAQ/GS: STLD) today provided first quarter 2017 earnings
guidance in the range of $0.77 to
$0.81 per diluted share, compared to prior year first
quarter earnings of $0.26 per diluted share and
sequential fourth quarter 2016 earnings of $0.08 per
diluted share, which included non-cash goodwill and asset
impairment charges of $0.31 per diluted share and debt
refinancing and repayment charges of $0.04 per diluted
share. Excluding these items, the company's adjusted fourth
quarter 2016 earnings were $0.43 per diluted share.
First quarter 2017 profitability from the company's steel
operations is expected to meaningfully increase in comparison to
sequential fourth quarter 2016 results, based on both higher
shipments and metal spread expansion. First quarter 2017
average steel product pricing is expected to increase, more than
offsetting the additional expense derived from higher ferrous scrap
costs. The anticipated higher earnings are driven by the
company's flat roll operations, as demand remains strong and
customer inventory levels continue to be positioned at historically
low levels. The company continues to believe that current and
anticipated macroeconomic and market conditions are in place to
benefit the domestic steel industry in the coming year. The
construction and automotive sectors remain strong, and the energy
sector has begun to strengthen.
First quarter 2017 profitably for the company's metals recycling
platform is also expected to improve compared to the sequential
fourth quarter, based on higher ferrous scrap demand and metal
spread expansion from increased domestic steel mill
utilization.
In what is typically a seasonally lower demand timeframe, strong
demand for the company's fabricated steel joist and deck products
is an indicator that the non-residential construction market is
continuing a positive growth trend. First quarter 2017
earnings from the company's fabrication business are expected to
improve based on increased shipments, which are anticipated to more
than offset metal spread compression.
Cash Dividends
The company's board of directors has
declared a quarterly cash dividend of $0.1550 per common
share, an 11% increase over the company's 2016 quarterly
rate. The dividend is payable to shareholders of record at
the close of business on March 31, 2017, and is payable on or
about April 10, 2017.
"We are pleased that our board of directors took this action,
based on our confidence in the current and anticipated future
strength of our cash flow generation capability and strong
financial position. Our ability to consistently generate
strong cash flow throughout all market cycles has clearly been
demonstrated," stated Mark D.
Millett, President and Chief Executive Officer. "This
performance is derived from our low, highly variable cost structure
and diversified, value-added product offerings. We have also
continued to repurchase shares of our common stock during the first
quarter 2017. We believe these actions reflect the strength
of our capital structure and liquidity profile, and the continued
optimism and confidence in our future prospects."
About Steel Dynamics, Inc.
Steel Dynamics, Inc.
is one of the largest domestic steel producers and metals recyclers
in the United States based on
estimated annual steelmaking and metals recycling capability, with
facilities located throughout the United
States, and in Mexico. Steel Dynamics produces steel
products, including hot roll, cold roll, and coated sheet steel,
structural steel beams and shapes, rail, engineered
special-bar-quality steel, cold finished steel, merchant bar
products, specialty steel sections and steel joists and deck.
In addition, the company produces liquid pig iron and processes and
sells ferrous and nonferrous scrap.
Forward-Looking Statements
This press release
contains some predictive statements about future events, including
statements related to conditions in the steel and metallic scrap
markets, Steel Dynamics' revenues, costs of purchased materials,
future profitability and earnings, and the operation of new or
existing facilities. These statements, which we generally precede
or accompany by such typical conditional words as "anticipate,"
"intend," "believe," "estimate," "plan," "seek," "project" or
"expect," or by the words "may," "will," or "should," are intended
to be made as "forward-looking," subject to many risks and
uncertainties, within the safe harbor protections of the Private
Securities Litigation Reform Act of 1995. These statements speak
only as of this date and are based upon information and
assumptions, which we consider reasonable as of this date,
concerning our businesses and the environments in which they
operate. Such predictive statements are not guarantees of future
performance, and we undertake no duty to update or revise any such
statements. Some factors that could cause such forward-looking
statements to turn out differently than anticipated include:
(1) the effects of uncertain economic conditions;
(2) cyclical and changing industrial demand; (3) changes
in conditions in any of the steel or scrap-consuming sectors of the
economy which affect demand for our products, including the
strength of the non-residential and residential construction,
automotive, appliance, pipe and tube, and other steel-consuming
industries; (4) fluctuations in the cost of key raw materials
(including steel scrap, iron units, and energy costs) and our
ability to pass-on any cost increases; (5) the impact of
domestic and foreign import price competition;
(6) unanticipated difficulties in integrating or starting up
new or acquired businesses; (7) risks and uncertainties
involving product and/or technology development; and
(8) occurrences of unexpected plant outages or equipment
failures.
More specifically, we refer you to Steel Dynamics' more detailed
explanation of these and other factors and risks that may
cause such predictive statements to turn out differently, as set
forth in our most recent Annual Report on Form 10-K under the
headings Special Note Regarding Forward-Looking Statements
and Risk Factors, in our quarterly reports on Form 10-Q
or in other reports which we from time to time file with the
Securities and Exchange Commission. These are available publicly on
the SEC website, www.sec.gov, and on the Steel Dynamics website,
www.steeldynamics.com: Investors: SEC Filings.
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SOURCE Steel Dynamics, Inc.