CHARLOTTE, N.C., Dec. 14, 2017 /PRNewswire/ -- Nucor Corporation
(NYSE: NUE) announced today guidance for its fourth quarter ending
December 31, 2017. Nucor expects
fourth quarter results to be in the range of $0.50 to $0.55 per
diluted share. This range is a decrease compared to the third
quarter of 2017 consolidated net earnings of $0.79 per diluted share and is comparable to the
fourth quarter of 2016 earnings of $0.50 per diluted share.
Projected fourth quarter of 2017 results do not contain any
estimates related to the impact of the proposed federal tax
legislation in the United States.
Third quarter of 2017 results included a net benefit totaling
$13.2 million, or $0.04 per diluted share, related to tax return
true-ups and state credits. Also included in third quarter of 2017
earnings was an expense of $22.5
million, or $0.05 per diluted
share, related to certain legal matters. Included in the
fourth quarter of 2016 results were the effects of a change in
estimate related to the cost of certain inventories that resulted
in a benefit of $77.6 million
($0.16 per diluted share).
Imports continue to negatively impact the U.S. steel industry.
Through the first ten months of 2017, total steel imports have
increased an estimated 19.4% compared to the same period last year.
Additionally, finished steel imports accounted for an estimated 28%
share of the U.S. market in the first ten months of 2017. Along
with other domestic steel producers, Nucor continues to pursue
trade cases to combat unfairly traded imports. The United States
Department of Commerce has made several rulings imposing duties on
additional steel products since the beginning of the year that are
favorable to the domestic steel industry. Recently, the Commerce
Department made a preliminary determination that
corrosion-resistant and cold-rolled steel from Vietnam that originated in China evaded U.S. anti-dumping and
anti-subsidy orders. As a petitioner in the case, Nucor believes
the preliminary determination is an important step in fighting
efforts to circumvent trade duties. A final determination is
expected to be announced in the first quarter of 2018. We are
encouraged by the steady progress that we are achieving through the
prosecution of product and country specific trade cases, although
the process is still slower than we feel is appropriate. We believe
this success is due to the overwhelming evidence that our foreign
competitors receive support from illegal subsidies.
We are encouraged by market conditions heading into 2018. We see
recently announced price increases and the downward trend in
imports late in the year from the mid-year peak as factors building
positive momentum. The automotive market remains healthy and
continues to be a bright spot for Nucor as we grow our penetration
of new automotive platforms. Nonresidential construction markets
remain stable at a level significantly below peak 2007 levels.
Energy markets continue their recovery from the depressed levels
experienced in late 2014 and 2015. Heavy equipment and agriculture
also continue to show signs of improvement. In general, we are
optimistic on expected overall industrial production in 2018.
We believe overall market demand in the fourth quarter of 2017
has been solid. However, expected fourth quarter of 2017
earnings in the steel mills segment will be negatively impacted by
margin compression as the import surge experienced in the summer of
2017 has been working its way through end markets over the last
half of the year. This pressure from imports combined with
weakness in plate steel have caused us to lower our fourth quarter
of 2017 earnings estimate for the steel mills segment. We expect
similar results in the steel products segment in the fourth quarter
of 2017 compared to the third quarter of 2017.
Nucor Steel Louisiana experienced an unplanned outage in the
fourth quarter of 2017 and resumed operations in early
December. However, this outage was shorter than the unplanned
outages experienced in the third quarter of 2017. Because of this,
we expect earnings of the raw materials segment in the fourth
quarter of 2017 to be improved from the third quarter of 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;
electrical conduit; 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 2016 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