Nucor 3Q Results Fall, Lowers 4Q Outlook
October 22 2019 - 8:53AM
Dow Jones News
By Dave Sebastian
Nucor Corp.'s (NUE) profit dropped in the latest quarter as
sales slid, driven by declines in plate and sheet shipments, though
results surpassed Wall Street expectations.
The steel manufacturer said its third-quarter net income was
$275 million, or 90 cents a share, down from $676.7 million, or
$2.13 a share, in the comparable quarter last year. Analysts polled
by FactSet were expecting 83 cents a share. It had guided profit to
be between 75 cents and 80 cents a share in the third quarter.
Sales for the quarter declined to $5.46 billion from $6.74
billion in the prior year. Analysts expected $5.54 billion.
Nucor shipped 6.56 million tons to customers in the third
quarter, a 7% drop from a year earlier. Average steel scrap prices
fell 20% to $299 a ton from the year earlier.
Plate shipments during the quarter declined 26%, while sheet
shipments fell 3%. Nucor said plate and sheet market conditions
softened, and excess inventory in the supply chain has led its
customers to destock.
The company's raw-materials segment recorded a loss of $10.6
million, compared with a loss of $29.1 million a year ago. Nucor
said the segment's operating performance decreased due to margin
compression in the company's direct reduced iron business, whose
facility in Louisiana began a planned outage in early September and
is expected to last until mid-November, thus affecting
fourth-quarter results.
Nucor said it expects earnings to decrease in the fourth quarter
compared with the third quarter, as lower steel prices at the end
of the latest quarter would hurt results. The company also sees
profitability in the steel-products segment decreasing in the
fourth quarter compared with the latest quarter due to year-end
seasonality.
Write to Dave Sebastian at dave.sebastian@wsj.com
(END) Dow Jones Newswires
October 22, 2019 08:38 ET (12:38 GMT)
Copyright (c) 2019 Dow Jones & Company, Inc.
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